Adobe Inc.
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Adobe trades at 13.66x trailing earnings and 9.56x EV/EBITDA—roughly 42–47% below software-infrastructure peer medians—while quarterly revenue growth has accelerated for four straight quarters to 12.9% YoY in Q3 FY2026 (ended 28 Aug), up from 10.5% in Q4 FY2025.
FY2025 delivered 35.1% EPS growth to $16.70, a 36.6% operating margin, and $9.85B in free cash flow at a 41.5% FCF margin, and the MACD histogram has turned positive at +1.86 from deeply negative levels. The expanded NVIDIA partnership and Adobe's appearance in AI visibility indices suggest the market's 32% YTD selloff may be overpricing a cannibalization threat that has not materialized in the numbers, though persistent insider selling (-$49.0M net over 24 months) and fading smart money (0.02 as of June 2026) warrant monitoring.
What could go wrong
- AI cannibalization of Creative Cloud. Generative-AI tools could erode Creative Cloud pricing power and subscription retention, a concern amplified by the stock's 32% YTD decline despite triple-digit AI revenue growth cited in recent press.
- Persistent insider selling. Insiders sold a net $49.0M in shares over the trailing 24 months with only 1 acquisition against 21 dispositions; CEO Narayen continued selling on 16 Sep and 17 Sep.
- Fading institutional positioning. Smart money score declined to 0.02 as of 30 Jun from 0.094 as of 30 Sep 2025, with fund count dropping from 71 to 68; data is stale and Q3 2026 13F filings are still arriving.
- Technical overhead resistance. Stock at $245.20 trades below both the 50-day ($256.54) and 200-day ($254.21) moving averages, limiting near-term upside unless reclaimed.
What would change my mind
Where this comes from: peer comparison · quarterly results · FY25 fundamentals · technicals, 16 Oct. Orin's read on ADBE; not advice.
How has the share price moved?
Down 30.6% over twelve months, from $357.80 on 27 Oct 2025 to $248.36 at the Tue 27 Oct 2026 close. Its highest close in that time was $359.91 on 28 Oct 2025; the last close is 31.0% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 25.1M, on 12 Jun 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All ADBE filings| Form | Filed | What it says | Read |
|---|---|---|---|
| 10-Q | 22 Sep | Adobe reported total revenue of $6.76 billion for the three months ended August 28, 2026, an increase of 13% year-over-year. | read |
| 8-K | 10 Sep | — | on file |
| 8-K | 8 Sep | — | on file |
| 13G | 7 Aug | — | on file |
| 13G/A | 27 Jul | — | on file |
| 8-K | 17 Jul | Adobe Inc. entered into a form of retention letter with Louise Pentland on July 14, 2026, triggering Item 5.02. | read |
| 10-Q | 15 Jun | Adobe reported total revenue of $6.618 billion for the three months ended May 29, 2026, an increase of 13% year-over-year from $5.873 billion. | read |
| 8-K | 11 Jun | Adobe Inc. announced its second quarter fiscal year 2026 financial results on June 11, 2026. | read |
Largest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $8.4B | 0.1% |
| Vanguard Capital Management | $5.4B | 0.1% |
| State Street | $4.2B | 0.1% |
| Invesco | $3.0B | 0.2% |
| Geode Capital Management | $2.4B | 0.1% |
| Vanguard Portfolio Management | $1.9B | 0.1% |
| Morgan Stanley | $1.1B | 0.1% |
| Norges Bank | $1.0B | 0.1% |
| Bank of New York Mellon | $954.5M | 0.2% |
| Northern Trust | $928.3M | 0.1% |
135 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 709 Form 4 filings; open-market trades net −$49.0M. Of the 50 on hand, none was an open-market trade — the rest are grants, option exercises and tax withholding.
Ask Orin about ADBE
Orin answers questions about ADBE from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 13.8× its last 12 months of profit (Tue 27 Oct close) — lower than in all 5 of its last 5 fiscal years (middle 41.5×); the typical Technology company on the NASDAQ is at 46.1×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 13.8×below usual | 41.5× | 46.1× |
| P/S | 3.72×below usual | 10.7× | — |
| EV/EBITDA | 9.7×below usual | 28.8× | — |
| P/B | 8.3×below usual | 16.4× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $261 (from $190 to $379) — 5% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$261
$190 – $379 · +5% against the last close
- 4 buy or overweight
- 19 hold
- 6 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 13.8× its last 12 months of profit; the middle P/E of the 4 companies it is compared to that made a profit is 25.7×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| ADBEAdobe Inc. | $97B | 13.8× | 9.7× | 89.1% | 28.0% | 63% |
| ADSKAutodesk, Inc. | $51B | 31.2× | 21.8× | 91.2% | 21.1% | 53% |
| CRMSalesforce, Inc. | $198B | 21.9× | 13.8× | 77.3% | 22.0% | 20% |
| MSFTMicrosoft Corporation | $3.95T | 29.5× | 19.1× | 67.9% | 40.3% | 33% |
| PTCPTC Inc. | $21B | 21.9× | 14.6× | 82.8% | 37.8% | n/m |
- PTC: return on equity is not meaningful (n/m) — book value is below zero.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 13.8× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now13.8×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Technology companies on the NASDAQ were priced at a typical 46.1× their yearly profit (Tue 27 Oct close).
- Now46.1×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $340 a share — 36% above the $250.34 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $340 | 36% above $250.34 |
| Levered | $414 | 65% above $250.34 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.