Adobe Systems (NASDAQ: ADBE) is one of 65 publicly-traded companies in the “Application Software” industry, but how does it weigh in compared to its rivals? We will compare Adobe Systems to similar businesses based on the strength of its valuation, profitability, institutional ownership, risk, earnings, analyst recommendations and dividends.

Analyst Recommendations

This is a breakdown of current ratings for Adobe Systems and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Adobe Systems 1 5 23 0 2.76
Adobe Systems Competitors 244 1696 2918 109 2.58

Adobe Systems presently has a consensus price target of $159.57, indicating a potential upside of 9.75%. As a group, “Application Software” companies have a potential upside of 9.15%. Given Adobe Systems’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Adobe Systems is more favorable than its rivals.

Profitability

This table compares Adobe Systems and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Adobe Systems 23.06% 21.40% 12.51%
Adobe Systems Competitors -62.18% -91.89% -16.30%

Volatility and Risk

Adobe Systems has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, Adobe Systems’ rivals have a beta of 1.61, suggesting that their average share price is 61% more volatile than the S&P 500.

Insider & Institutional Ownership

87.4% of Adobe Systems shares are owned by institutional investors. Comparatively, 68.7% of shares of all “Application Software” companies are owned by institutional investors. 0.4% of Adobe Systems shares are owned by insiders. Comparatively, 15.8% of shares of all “Application Software” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Adobe Systems and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Adobe Systems $6.90 billion $2.32 billion 45.58
Adobe Systems Competitors $761.43 million $137.66 million -10.51

Adobe Systems has higher revenue and earnings than its rivals. Adobe Systems is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Summary

Adobe Systems beats its rivals on 10 of the 13 factors compared.

About Adobe Systems

Adobe Systems Incorporated is a software company. The Company offers products and services used by professionals, marketers, knowledge workers, application developers, enterprises and consumers for creating, managing, delivering, measuring, optimizing and engaging with compelling content and experiences. It operates through three segments: Digital Media, Digital Marketing, and Print and Publishing. Its Digital Media segment provides tools and solutions that enable individuals, small and medium businesses and enterprises to create, publish, promote and monetize their digital content. Its Digital Marketing segment provides solutions and services for how digital advertising and marketing are created, managed, executed, measured and optimized. Its Print and Publishing segment addresses market opportunities ranging from the diverse authoring and publishing needs of technical and business publishing to its legacy type and original equipment manufacturer (OEM) printing businesses.

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