Adobe Q1 on tap, investors looking for software strength
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Adobe (NASDAQ:ADBE) is slated to report first-quarter results after the close of trading on Tuesday and investors will be looking to see if rising competition is hitting the company's growth.
Last week, Citi analyst Tyler Radke lowered his price target going into the results, noting Adobe (ADBE) is like to see "lower-than-typical upside" to its key Net New annual recurring revenue metric, or nnARR, due to rising competition at the low end of the market. It may also see slower digital marketing spending, which could limit revenue.
"While we saw solid overall bookings performance from [Salesforce], we did observe some signs of slower growth in the Marketing Cloud where growth decelerated to ~20% from ~25% [year-over-year]," Radke wrote in a note to clients.
A consensus of Wall Street estimates expects Adobe (ADBE) to earn $3.34 per share on $4.24 billion in revenues.
Information compiled by Seeking Alpha notes that Adobe (ADBE) has beaten earnings per share 100% of the time and revenue estimates 88% of the time over the past two years.
Adobe (ADBE) was recently mentioned by Wedbush Securities as one of the stocks that could be bought after the Federal Reserve gave a "bright green light" to investors following its interest rate hike last week.