Adobe (NASDAQ:ADBE) Downgraded by Citigroup to “Sell”

Adobe (NASDAQ:ADBE) was downgraded by stock analysts at Citigroup from a “neutral” rating to a “sell” rating in a research note issued on Wednesday, Marketbeat.com reports. They currently have a $207.00 price objective on the software company’s stock. Citigroup‘s price objective points to a potential downside of 15.90% from the company’s current price.

Other analysts have also recently issued reports about the stock. Sanford C. Bernstein decreased their price objective on shares of Adobe from $379.00 to $373.00 and set an “outperform” rating on the stock in a research note on Friday, September 11th. DA Davidson lifted their target price on shares of Adobe from $250.00 to $290.00 and gave the company a “buy” rating in a research note on Monday, September 14th. Wells Fargo & Company downgraded Adobe from an “overweight” rating to an “underweight” rating and reduced their target price for the stock from $270.00 to $225.00 in a report on Monday, October 12th. Piper Sandler boosted their target price on Adobe from $240.00 to $250.00 and gave the stock a “neutral” rating in a report on Friday, September 11th. Finally, Mizuho set a $260.00 price target on Adobe and gave the stock a “neutral” rating in a research report on Tuesday, September 8th. Nine equities research analysts have rated the stock with a Buy rating, nineteen have given a Hold rating and eight have assigned a Sell rating to the company. Based on data from MarketBeat.com, Adobe presently has an average rating of “Hold” and a consensus price target of $282.52.

Adobe Stock Down 2.1%

Shares of NASDAQ:ADBE opened at $246.14 on Wednesday. The company’s fifty day moving average is $253.29 and its 200-day moving average is $250.40. The company has a debt-to-equity ratio of 0.41, a quick ratio of 0.77 and a current ratio of 0.77. Adobe has a 52 week low of $190.12 and a 52 week high of $362.71. The company has a market capitalization of $95.80 billion, a PE ratio of 13.74, a P/E/G ratio of 0.88 and a beta of 1.37.

Adobe (NASDAQ:ADBE) last announced its earnings results on Thursday, September 10th. The software company reported $6.13 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $6.08 by $0.05. Adobe had a net margin of 28.05% and a return on equity of 65.65%. The business had revenue of $6.76 billion during the quarter, compared to analysts’ expectations of $6.69 billion. During the same quarter last year, the company posted $5.31 EPS. The firm’s revenue for the quarter was up 12.9% on a year-over-year basis. Adobe has set its Q4 2026 guidance at 6.300-6.350 EPS and its FY 2026 guidance at 24.450-24.500 EPS. Equities research analysts predict that Adobe will post 20.01 earnings per share for the current fiscal year.

Insider Buying and Selling

In other Adobe news, CEO Shantanu Narayen sold 50,500 shares of the stock in a transaction dated Thursday, September 17th. The shares were sold at an average price of $249.57, for a total transaction of $12,603,285.00. Following the sale, the chief executive officer owned 238,724 shares of the company’s stock, valued at $59,578,348.68. This represents a 17.46% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. 0.20% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Adobe

A number of large investors have recently modified their holdings of the stock. Cyndeo Wealth Partners LLC boosted its position in Adobe by 2.8% in the 3rd quarter. Cyndeo Wealth Partners LLC now owns 1,559 shares of the software company’s stock valued at $374,000 after buying an additional 43 shares during the last quarter. Meridian Management Co. raised its position in shares of Adobe by 0.3% during the first quarter. Meridian Management Co. now owns 15,241 shares of the software company’s stock worth $3,705,000 after acquiring an additional 44 shares during the last quarter. Brown Shipley& Co Ltd raised its position in shares of Adobe by 28.8% during the first quarter. Brown Shipley& Co Ltd now owns 197 shares of the software company’s stock worth $48,000 after acquiring an additional 44 shares during the last quarter. Pzena Investment Management LLC lifted its stake in shares of Adobe by 4.0% during the third quarter. Pzena Investment Management LLC now owns 1,138 shares of the software company’s stock valued at $273,000 after acquiring an additional 44 shares during the period. Finally, United Bank lifted its stake in shares of Adobe by 1.4% during the first quarter. United Bank now owns 3,658 shares of the software company’s stock valued at $889,000 after acquiring an additional 49 shares during the period. 81.79% of the stock is currently owned by institutional investors and hedge funds.

Key Headlines Impacting Adobe

Here are the key news stories impacting Adobe this week:

• Positive Sentiment: Adobe is bringing licensed music from Universal Music Group and Warner Music Group to Premiere mobile. The added music catalog could make the video-editing app more useful and attractive to creators, though the reports did not describe a financial contribution. Forbes article on Adobe’s music deals
• Neutral Sentiment: Analyst views remain split: some see potential in Adobe’s freemium offerings and AI, while others are wary of softer annual recurring revenue (ARR) trends and competition. A compiled fair-value estimate was trimmed from $275.06 to $268.30, suggesting somewhat less estimated upside. Analyst views on Adobe fair value
• Negative Sentiment: Investors may be concerned that AI could challenge Adobe’s competitive edge, as new AI tools and software alternatives raise questions about the durability of its business and pricing power. This concern adds to pressure from competition and softer ARR trends. Article on AI and Adobe’s competitive edge

Adobe Company Profile

Adobe Inc is a global software company that develops digital tools for creative professionals, businesses, marketers, and individual users. Its products help customers create, edit, publish, manage, and measure digital content across websites, mobile applications, documents, and other media.

The company’s Creative Cloud portfolio includes applications such as Photoshop, Illustrator, InDesign, Premiere Pro, and Acrobat. Adobe also offers Document Cloud, which provides tools for creating, editing, sharing, signing, and managing digital documents, and Experience Cloud, a suite of solutions for digital marketing, analytics, commerce, customer journeys, and content management.