Based on the aggregated intelligence of 115,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, software provider Adobe Systems (Nasdaq: ADBE) has earned a respected four-star ranking. While five-star stocks have been the best performers, our data has shown that four-star stocks still outshine the market by a significant margin and shouldn't be taken lightly; conversely, low-rated stocks have woefully lagged the market average.
With that in mind, let's take a closer look at Adobe's business, and see what CAPS investors are saying about the stock right now.
Adobe facts
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Headquarters (Founded)
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San Jose, California (1982)
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Market Cap
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$13.85 billion
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Industry
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Application Software
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TTM Revenue
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$3.58 billion
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Management
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CEO Shantanu Narayen (since 2007)
CFO Mark Garrett (since 2007)
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Return on Equity (average last three years)
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16.23%
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Competitors
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Microsoft (Nasdaq: MSFT),
Apple (Nasdaq: AAPL)
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CAPS members bullish on ADBE also bullish on
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Google (Nasdaq: GOOG),
Cisco Systems (Nasdaq: CSCO)
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CAPS members bearish on ADBE also bearish on
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Amazon.com (Nasdaq: AMZN),
Meritage Homes (NYSE: MTH)
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Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.
Over on CAPS, fully 307 of 320 of the All-Star members who have rated Adobe -- some 96% -- believe the stock will outperform the S&P 500 going forward. These All-Star bulls include TheDoberman and raja786, both of whom are ranked in the top 10% of our community.
In February, TheDoberman reminded our community that "Up until recently, there were only two major players: Adobe and Macromedia. Now of course they are one company, churning out great products with no competition. ... These are THE ONLY tools to use."
A more recent (and much more technical) pitch by raja786 agrees with that sentiment, elaborating on the stock's monopolistic qualities. Check out the entire argument, but here's an excerpt to tease you:
- I have worked with dynamically generating PDFs, and when it comes to choosing alternatives, there simply aren't any.
- Their Flex/Flash platform is growing at an unprecedented rate within the industry. It is by far the best solution for high end RIA and Rich media solutions. ...
- By aligning Flex development closely with Java, Adobe has allowed the huge pool of Java Developers to easily get into Flex. This gives them a huge resource pool. ... Anyway, I realize I might be getting too technical, but basically the potential is huge, and if Adobe management continues to execute its strategy, I think this stock will continue to grow.
What do you think about Adobe, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 115,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.
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