Adobe drops following UBS downgrade on fears of slowing growth
hapabapa/iStock Editorial via Getty Images


Adobe (NASDAQ:ADBE) shares were declining early Wednesday morning, losing nearly 4% after UBS analyst Karl Keirstead downgraded the stock on fears of slowing growth in 2022.
In a note to investors, Keirstead said marketing spend was pulled forward in 2020 and 2021 more than investors think, which could hurt Adobe's (ADBE) growth rate this year. As such, he lowered his rating to neutral, down from buy, and slashed his price target to $575.

Adobe (ADBE) shares fell nearly 4% to $532.55 on Wednesday.
"We are not yet adjusting our CY22/ FY23 growth estimates, but the risk of disappointing beats (or even a miss) is not insignificant," Keirstead explained, adding that in the current rate environment, he prefers Microsoft (NASDAQ:MSFT) and ServiceNow (NYSE:NOW) to Adobe.
Keirstead noted that the mix of marketing technology is "shifting," which could negatively impact Adobe's (ADBE) digital experience revenue more than expected.
Last month, Adobe (ADBE) gave an earnings and revenue forecast for next year that fell short of analysts' estimates, leading to speculation about the digital publishing and marketing giant's growth prospects.