Piper Sandler has revised its outlook for Adobe (ADBE, Financial), lowering the price target from $600 to $500 while maintaining an Overweight rating. This adjustment reflects the broader challenges impacting the cloud applications and analytics sectors, including tariffs, regulatory policies, and the complexities of artificial intelligence integration.
The firm acknowledges significant headwinds that have subdued growth expectations in the software industry for a fourth consecutive year. Furthermore, the anticipated benefits from AI adoption have been slower than expected, further contributing to a less optimistic growth outlook. According to analyst Brent Bracelin, investor sentiment towards application software stocks has weakened considerably, pushing valuation multiples to their lowest levels in seven years.
Despite these hurdles, the direct impact of tariffs on software business models is considered minimal, suggesting that other factors are more significantly impeding sector performance. The reassessment underscores the ongoing challenges within the tech sector and indicates a cautious outlook for short-term growth.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 33 analysts, the average target price for Adobe Inc (ADBE, Financial) is $509.17 with a high estimate of $660.00 and a low estimate of $380.00. The average target implies an upside of 45.51% from the current price of $349.91. More detailed estimate data can be found on the Adobe Inc (ADBE) Forecast page.
Based on the consensus recommendation from 41 brokerage firms, Adobe Inc's (ADBE, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Adobe Inc (ADBE, Financial) in one year is $629.07, suggesting a upside of 79.78% from the current price of $349.91. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Adobe Inc (ADBE) Summary page.
