adobe

What is Adobe?

Adobe is a multinational software company best known for its creative and digital media products. Founded in 1982 by John Warnock and Charles Geschke, Adobe originally focused on desktop publishing and revolutionized the industry with its PostScript technology. Over time, it expanded into a broad suite of tools that support graphic design, video editing, photography, and web development. Flagship products like Photoshop, Illustrator, Premiere Pro, and Acrobat have become industry standards, widely used by professionals and hobbyists alike.

In recent years, Adobe has transitioned from a traditional software licensing model to a cloud-based subscription service known as Adobe Creative Cloud. This shift has allowed users to access software updates more frequently and collaborate more easily across devices. Beyond creative tools, Adobe has also built a strong presence in digital marketing and analytics through its Adobe Experience Cloud, offering businesses solutions for customer data management, advertising, and personalized content delivery.

Adobe continues to play a significant role in shaping the digital economy by enabling creativity, communication, and digital transformation. Its innovations in artificial intelligence, such as Adobe Sensei, enhance automation and streamline workflows across its platforms. As content creation and digital experiences become increasingly important across industries, Adobe remains a key player, continually adapting its technologies to meet evolving user needs.

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Growth Stocks

Adobe is Still a Hold

ADOBE SYSTEMS INC. $40.20 (Nasdaq symbol ADBE; SI Rating: Average) (408-536- 6000; www.adobe.com; Shares outstanding: 583.3 million; Market cap: $23.5 billion) reported 33.7% higher revenues in the three months ended December 1, 2006, up to $682.2 million from $510.4 million. Ongoing earnings per share rose 6.5%, to $0.33 from $0.31. Adobe holds cash of $2.3 billion or $3.91 a share, and it has no long-term debt. The company has plenty of financing for new product development. Adobe spends a high 21% of sales on research and development. However, it faces competition from freeware versions of some of its software. As well, Adobe’s high p/e of 34 makes it vulnerable to any bad news....

1 min read

Pat McKeough

How To Invest

Two Technology Funds for Aggressive Investors

TD SCIENCE & TECHNOLOGY FUND $15.37 (CWA Rating: Aggressive) (TD Asset Management, P.O. Box 7500, Station A, Toronto, Ontario. M5W1P9. 1-800-461-3863; Web site: www.tdcanadatrust.com. No load — deal directly with the company) invests mostly in U.S. firms. The fund’s gain over the last year was 7.8%. The Nasdaq index rose 6.5%. The $135.5 million fund’s manager is well-respected U.S. mutual fund manager T. Rowe Price Associates. Its MER is 2.79%. TD Science & Technology’s top holdings include: Microsoft, 5.1%; Juniper Networks, 3.0%; Samsung Electronics, 2.8%; Yahoo!, 2.8%; American Tower, 2.5%; Google, 2.5%; Hoya Corporation, 2.4%; Cisco Systems, 2.4%; Taiwan Semiconductor, 2.2%; and Adobe Systems, 2.1%. TD Science & Technology Fund is a buy for aggressive investors only....

1 min read

Pat McKeough

Growth Stocks

Updating American Woodmark, Miranda Gold and Adobe Systems Inc.

AMERICAN WOODMARK $41.52 (Nasdaq symbol AMWD; SI Rating: Speculative) (540-665-9100; www.americanwoodmark.com; Shares outstanding: 15.7 million; Market cap: $650.2 million) is the third-largest maker of kitchen and bath cabinets in the U.S. The company offers more than 230 cabinet lines in a wide variety of designs, materials and finishes. It sells its products through a network of dealers and distributors and directly to home centers and major homebuilders. The company now operates 15 plants and 10 service centres across the U.S. In the three months ended October 31, 2006, revenues fell 1.7%, to $210.8 million from $214.5 million. However, earnings per share rose 54.1%, to $0.57 from $0.37. The lower revenues came from the company’s ongoing shift away from lower-profit products. The improved earnings were due to the shift to higher-profit products, and an improvement in profit margins as it continued to cut material and labor costs....

2 min read

Pat McKeough

Growth Stocks

Updating Hewlett-Packard Co., Newell Rubbermaid Inc., Microsoft Corp., Adobe Systems Inc. and United Technologies Corp.

HEWLETT-PACKARD CO. $35 (New York symbol HPQ; Conservative Growth Portfolio, Manufacturing & Industry sector; WSSF Rating: Above average) is holding up well despite news that the company’s former chair used questionable surveillance techniques to identify a director who leaked certain information to the media. While embarrassing, we feel that the scandal will do little long-term damage to Hewlett’s business. Hewlett-Packard is a buy. NEWELL RUBBERMAID INC. $29 (New York symbol NWL; Income Portfolio, Consumer sector; WSSF Rating: Average) has agreed to sell its Little Tykes division, which makes children’s toys and furniture. The sale should generate a gain of between $15 million and $25 million; Newell earned $149.6 million or $0.54 a share before unusual items in its most recent quarter. The sale is part of Newell’s plan to sell less-profitable products, and focus on fastergrowing products such as office supplies....

2 min read

Pat McKeough

Growth Stocks

Adobe Systems Inc. $36 - Nasdaq symbol ADBE

ADOBE SYSTEMS INC. $36 (Nasdaq symbol ADBE; WSSF Rating: Average) makes software that helps users create electronic documents. Its main product is Acrobat, which let users convert documents to the popular PDF format. In December 2005, Adobe merged with Macromedia Inc. in an all-stock transaction valued at $3.4 billion. Macromedia’s main product is Flash, which lets Internet web page creators add animation and other features that make their sites easier to use. Like Acrobat, Flash is an industry standard. In Adobe’s first fiscal quarter ended March 3, 2006, it earned $0.32 a share (total $197.5 million) before restructuring and other unusual costs, up 23.1% from $0.26 a share ($133.8 million) a year earlier. Revenue grew 38.6%, to $655.5 million from $472.9 million....

1 min read

Pat McKeough

Growth Stocks

Top software makers still have appeal

Our recommendations in software stocks have delivered huge gains in the past few years. But many now face growing competition from free software on the Internet, or they trade at high p/e’s. Computer makers are also demanding lower prices for pre-installed programs to keep the costs of new computers down. We still hold a high opinion of these top software makers, but we advise against new buying right now. AUTODESK INC. $38 (Nasdaq symbol ADSK; WSSF Rating: Average) makes AutoCAD, the world’s top selling computer aided design program. About 4 million architects and engineers in over 100 countries use it to design and test new buildings and products. This business supplies nearly 90% of its revenue. The remainder comes from programs that filmmakers use to create special effects....

6 min read

Pat McKeough