ADBE

Since April 2026, Adobe has been in a holding pattern, posting a small return of 3.1% while floating around $254.84. The stock also fell short of the S&P 500's 8.9% gain during that period. Is now the time to buy Adobe, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it's free. We're cautious about Adobe. Here are three reasons why there are better opportunities than ADBE, plus one stock we'd rather own. Billings is a non-GAAP metric that is often called "cash revenue" because it shows how much money the company has collected from customers in a certain period. This is different from revenue, which must be recognized in pieces over the length of a contract. Adobe's billings came in at $6.71 billion in Q3, and over the last four quarters, its year-on-year growth averaged 11.9%. This performance was underwhelming and suggests that increasing competition is causing challenges in acquiring/retaining customers. Forecasted revenues by Wall Street analysts signal a company's potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite. Over the next 12 months, sell-side analysts expect Adobe's revenue to rise by 9.3%, a slight deceleration versus its 11.5% annualized growth for the past five years. This projection doesn't excite us and indicates its products and services will face some demand challenges. While many software businesses point investors to their adjusted profits, which exclude stock-based compensation (SBC), we prefer GAAP operating margin because SBC is a legitimate expense used to attract and retain talent. This is one of the best measures of profitability because it shows how much money a company takes home after developing, marketing, and selling its products. Analyzing the trend in its profitability, Adobe's operating margin might have fluctuated slightly but has generally stayed the same over the last two years. This raises questions about the company's expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Its operating margin for the trailing 12 months was 35.7%. Adobe's business quality ultimately falls short of our standards. With its shares trailing the market in recent months, the stock trades at 3.4× forward price-to-sales (or $254.84 per share). This valuation multiple is fair, but we don't have much faith in the company. We're fairly confident there are better investments elsewhere. Let us point you toward a top digital advertising platform riding the creator economy. ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it's flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.

AI hype is colliding with earnings season, and Meta's upcoming report has suddenly become a live stress test for the whole trade. After the sharp pullback in Nvidia and the Nasdaq 100, investors are asking which digital ad and social platforms look ready to handle heavier AI spending and tougher expectations. This article breaks down three stocks that appear positioned to benefit if confidence in AI-driven monetization holds up. The three stocks discussed below are just a starting sample. The full screen surfaces 9 more US large-cap digital ad and social platforms with AI-linked monetization stories that are not covered here but carry equally compelling setups and business narratives. If you want to go straight to the source and identify, compare, and analyze the highest conviction ideas in this theme, head into the US Large-Cap Digital Ad & Social Platforms with AI-Driven Monetization screener. Overview: Zeta Global Holdings runs an AI-heavy marketing cloud that helps large brands target, message, and measure ad campaigns across digital channels. Operations: Zeta Global generates about US$1.6b in Internet Software & Services revenue, with roughly US$1.5b from the United States and US$116 million internationally. Market Cap: US$8.0b For an AI-focused adtech theme built around actual monetization, Zeta Global sits close to the action, wiring intelligence directly into how big advertisers find and retain customers. "Zeta's deep penetration into independent agencies and global agency holdcos, where only a tiny fraction of brands have adopted the platform, points to a vast, under-tapped market; even modest share gains here can drive exponential revenue and ARPU growth as penetration scales far beyond current levels." What really matters now is how one unresolved pressure on Zeta's model shapes the trade off between richer AI tools and long term margins. That trade off sits at the center of the full narrative for Zeta Global Holdings, which maps how AI spend, customer adoption, and margin pressure could all be quietly accelerating. Overview: Adobe helps creatives and enterprises design, manage, and personalize digital content and customer experiences, increasingly using AI to support ad performance. Operations: Adobe reports US$15.3b of segment adjustments with geographic revenue anchored in EMEA at US$7.1b and APAC at US$3.6b. Market Cap: US$95.4b Adobe matters for this AI-focused ad and social screen because its creative and marketing clouds quietly power how brands design campaigns and measure performance across the internet. "Monetization Clarity: As "AI-first ARR" moves from $250 million toward the $1 billion mark, the market will stop viewing AI as a threat and start viewing it as a growth engine." The real swing factor for Adobe is how one quiet shift in enterprise AI usage may affect pricing power, margins, and long-term demand. That shift in behavior is the hinge. Read the full narrative for Adobe to see how AI-first ARR could be masking bigger swings in pricing power and demand. Overview: HubSpot runs a cloud CRM that helps mid-sized businesses attract, convert, and retain customers through AI-assisted marketing, sales, and service tools. Operations: HubSpot generates about US$3.4b in Internet Software & Services revenue, including roughly US$281 million from Asia Pacific. Market Cap: US$11.5b HubSpot matters for this AI-focused ad and social theme because its CRM is where many AI-optimized campaign decisions are made. "AI commoditization: basic marketing content, chatbots and automation features are especially exposed to low-cost AI competitors. Failure to differentiate AI or to monetize advanced features could pressure ARPU." Everything comes down to what happens if a relatively quiet shift in how customers pay for AI-powered tools reshapes HubSpot's pricing power and margins. To see how that payment shift could actually accelerate upside for HubSpot rather than just squeeze ARPU, read the full narrative for HubSpot for the full risk reward picture. Markets can move quickly, and the newest breakout stories rarely stay under the radar for long. Focus on current momentum while it is still relevant and before pricing fully adjusts. Consider acting promptly based on your own research and judgment. - Scan for higher yields with balance sheet strength and let the 8 dividend fortresses highlight income ideas that some investors may overlook. - Explore potential infrastructure-related opportunities and use the 42 power grid technology and infrastructure stocks to research grid technology companies. - Evaluate the automation theme and review the 91 robotics and automation stocks to research companies involved in robotics. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Adobe (NASDAQ:ADBE) posted record revenue in its fiscal third quarter, raised its full-year targets, and crossed 1 billion monthly active users. The stock shrugged. It now trades at less than 10 times expected earnings, a multiple usually reserved for businesses in decline. That's an odd price tag for a company that would easily rank among the 10 Best Return on Equity (ROE) Stocks to Buy given its operating efficiency, yet it is still growing revenue by double digits. Adobe sells subscription software: Photoshop, Premiere, and Illustrator for creative pros, Acrobat for anyone who has ever signed a PDF, and marketing tools for big brands through Experience Cloud. So which is wrong, the price or the business? The answer hinges less on this year's results than on whether generative AI turns Adobe's toolbox into a commodity. Adobe's edge has always been workflow lock-in. Professionals train on its tools for years, and agencies build whole pipelines around its file formats. Ripping that out means retraining people and rebuilding processes. The proof still shows up in the numbers. Total annualized recurring revenue (ARR, the yearly value of active subscriptions) ended fiscal Q3 at $27.50 billion. Creative & Marketing Professionals subscription revenue rose 13% to $4.65 billion, while the Business Professionals & Consumers group, home of Acrobat, grew faster at 16% to $1.91 billion. Pricing power hasn't vanished either. Adobe expects a non-GAAP operating margin of about 45% for fiscal 2026, a level few software companies reach. That profit cushion funds its fight against nimbler rivals, a competitive battle explored further in our coverage of how Adobe Is Inviting Figma Users to Test a New AI Design Tool. Adobe's answer to AI disruption is to build it into its own products. AI-first ARR grew more than 150% year over year in fiscal Q3, and the company passed the billion-user mark across its creativity and productivity apps. Management is also leaning into a freemium strategy, using free entry points to pull in users it can upsell later. The financials held up anyway. Fiscal Q3 operating cash flow hit a record $2.52 billion, and non-GAAP EPS climbed to $6.13 from $5.31 a year earlier. Turning free users into paying ones is the same race facing other Best AI Stocks to Buy in October. Leadership is changing too. Anil Chakravarthy, who runs the customer-experience business and worldwide field operations, takes over as CEO later this year, with Shantanu Narayen moving to executive chair. A new boss inheriting a strategy shift adds execution risk. Here's the strongest bear case: forward-looking indicators are cooling faster than revenue. Adobe's own full-year target calls for ending ARR growth of 10.2%, below the 13% revenue growth it posted in fiscal Q3. Remaining performance obligations (contracted revenue not yet recognized) slipped to $22.16 billion at the end of fiscal Q3 from $22.27 billion a quarter earlier. The freemium push explains part of that. Free users don't show up in ARR until they convert, and there's no guarantee enough of them will. If AI tools let casual creators skip paid software altogether, the billion-user milestone could prove wider than it is deep. That's the main reason the stock sits where it does. At a forward P/E of 9.90, as of October 9, investors are paying under $10 for every $1 of expected earnings. That compares with a sector average of 23.35 and Adobe's own five-year average of 24.95. Earnings, meanwhile, are expected to keep climbing, with EPS growth projected at 13.07% in 2028. A business compounding profits at a low-teens pace rarely carries a single-digit multiple unless the market expects that growth to dry up. Buybacks add another lever. Adobe repurchased about 9.5 million shares in fiscal Q3, and its diluted share count fell to 395 million from 424 million a year earlier. At this valuation, each buyback dollar retires more stock, a heavy shareholder-return focus that echoes strategies seen among the 11 Best Agentic AI Stocks to Buy Right Now as companies deploy capital to defend their moats. It also matters which earnings you trust. Fiscal Q3 GAAP EPS was $4.62, versus $6.13 on a non-GAAP basis, which excludes stock-based compensation. Hedge fund interest cooled, with 81 funds holding the stock in the most recent quarter, down from 86 in the prior one. Short interest stands at 5.30% of the float, a moderate level of bearish positioning rather than a crowded bet against the company. The evidence points to a business that is bending rather than breaking. Revenue, cash flow, and earnings are still rising, while the multiple already assumes a sharp slowdown that hasn't shown up in the results. For patient investors who can stomach a messy leadership handoff, the setup looks unusually forgiving. ARR growth sliding into single digits while free users fail to convert would change that, and the low multiple would start to look earned. While we acknowledge the potential of ADBE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: This 6.3% Dividend Yield Looks Too Good to Ignore. Is the Stock a Buy? and 10 Best 52-Week Low Technology Stocks to Buy According to Analysts. Disclosure: None. Follow Insider Monkey on Google News.

A decade ago, shares of Adobe (NASDAQ:ADBE) closed at about $109. Today, they trade near $243 as I write. That's a rise of about 123%, enough to turn a $10,000 investment into about $22,300. It seems OK until you compare it to the market. In the same period, $10,000 in an S&P 500 (SNPINDEX:^GSPC) index fund (with dividends reinvested) rose to around $42,100, a gain of about 321%. Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » And because Adobe doesn't pay a dividend, its stock price is the full return. In other words, the creative software company has returned less than half as much as the broad market over the last decade. But its business kept growing all along. I think the gap boils down to how much investors were paying for Adobe's profits -- not the profits themselves. Image source: The Motley Fool. In the first half of the decade, Adobe was one of the market's big winners. The stock closed at a record $688.37 in November 2021, more than six times its October 2016 price. An S&P 500 index fund climbed around 138% over the same stretch. Since then, the two have switched places. The index fund is up about 77% from that November 2021 close, but Adobe stock is about 65% off its peak. Shares have dropped about 31% in 2026 alone, from roughly $350 when last year ended. Much of this year's slide came as investors worried that artificial intelligence (AI) might disrupt software companies. AI agents could take over some of the work businesses pay for one seat at a time, and Adobe sells many of its subscriptions that way. By mid-January, Adobe was already among the S&P 500's worst performers of 2026 as software stocks sold off on these fears. Showing how much Adobe grew under the surface, the company made $3.01 a share on a non-GAAP (adjusted) basis in fiscal 2016. Five years later, that number was $12.48, and revenue had almost tripled, from $5.85 billion to $15.79 billion. For this fiscal year, management's target calls for adjusted earnings per share between $24.45 and $24.50, on around $26.6 billion in revenue. That's about eight times the fiscal 2016 level. True, growth has slowed. Adjusted earnings per share compounded at around 33% a year from fiscal 2016 to fiscal 2021, versus about 14% a year since then if Adobe reaches this year's target. Part of the fall in the stock's valuation was arguably deserved. But the slowdown hasn't become a decline. Revenue has grown 12% to 13% year over year in all three quarters Adobe has reported this fiscal year. And in the fiscal third quarter of 2026 (the period ended Aug. 28, 2026), Adobe's adjusted earnings per share rose 15% over the year-ago quarter, to $6.13. Annualized recurring revenue from its AI-first products grew more than 150%. The valuation is where the decade went. In October 2016, investors paid around 36 times Adobe's fiscal 2016 adjusted earnings per share. At the November 2021 high, the stock cost about 55 times its fiscal 2021 adjusted earnings. Today's price is around 10 times this year's adjusted earnings target. In other words, earnings per share are on track to grow about eightfold, while the price of each dollar of those earnings has fallen by about 73%. Together, these two numbers explain the stock's 123% gain. I'd say a valuation of around 10 times adjusted earnings asks very little of Adobe. It's the sort of price the market tends to put on a business it expects to stall or shrink. Adobe's earnings per share are still growing at a double-digit rate. If its valuation multiple just stays around 10 times adjusted earnings, shares may climb about as fast as earnings per share from here. Sure, the risk is that AI one day does to Adobe's growth what the market fears. Management's own target already calls for total annualized recurring revenue to climb 10.2% this year, a little slower than revenue. If that rate keeps falling toward the low single digits, today's price-to-earnings ratio might turn out to be fair. In the end, I think the past decade says more about the price investors paid in 2021 than about the business. Back then, Adobe stock cost over 50 times adjusted earnings and needed almost everything to go right. Today it needs much less. I'd consider buying Adobe stock today. But with AI's long-term impact on Adobe's customers still unknown, I'd start with a small position. Before you buy stock in Adobe, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Adobe wasn't one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $385,972!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,416,196!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of October 10, 2026. Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Adobe. The Motley Fool recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy. Adobe's Earnings Are on Track to Grow About Eightfold in a Decade. Why Has Its Stock Lagged the Market So Badly? was originally published by The Motley Fool

Shares of Adobe (NASDAQ:ADBE) have had a tough 2026. The stock ended last year at about $350 and trades near $240 as I write, down about 31%. The software company has kept buying its own shares on the way down. In April, its board approved a new $25 billion stock buyback authorization, meant partly to "reduce share count over time." It runs through April 30, 2030. Missed AI's "Act 1"? Act 2 Could Be 14x Bigger. Most investors think they missed the AI boat because they didn't buy Nvidia in 2005. But according to our analysts, we're only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout. Continue » And as Adobe's fiscal third quarter of 2026 ended Aug. 28, $24.55 billion of it was still unused. Compared with Adobe's market value, the amount is large. With about 389.2 million shares outstanding in mid-September, Adobe is worth about $93 billion at today's stock price. The remaining authorization could buy back about 26% of it -- about 102 million shares. Sure, an authorization isn't a promise. Adobe has around three and a half years to use it, and nothing forces the company to spend it all. But I think the company's pace this year shows it plans to put plenty of it to work. Image source: Getty Images. In the fiscal year's first three quarters, Adobe's buybacks averaged around $2.3 billion a quarter. That came to $6.82 billion, for 26.1 million shares, all bought on the open market. And as the stock dropped, the same money bought more shares. The 9.5 million shares Adobe repurchased in fiscal Q3 cost an average of around $235 each, versus about $261 over all three quarters. Notably, the company paid for it with cash from its operations. Adobe generated $7.65 billion of cash from operations during the same stretch, up around 11% year over year, and buybacks used close to 90% of it. Its balance sheet had $5.64 billion of cash and short-term investments at quarter-end, versus around $6.4 billion of debt. This pace leaves room to spare. Spreading the unspent $24.55 billion evenly through April 2030 comes out to around $7 billion a year, about what Adobe spent in just those three quarters. If the company keeps buying at its recent rate instead, it could use up the authorization sometime in 2029. Adobe's diluted share count (the number used to calculate earnings per share) was around 395 million in the fiscal third quarter. That compares to 402 million in the fiscal second quarter and 424 million in the year-ago quarter. Management's fourth-quarter targets assume around 389 million. In other words, the count's dropping about 2% a quarter, and steadily. Not every repurchased share sticks, though. Shares outstanding dropped by around 22 million in the nine months, fewer than the 26.1 million Adobe bought, because employee stock awards added some back. Showing what the shrinking count means for shareholders, Adobe's non-GAAP (adjusted) net income rose around 8% year over year in fiscal Q3 to $2.42 billion. Adjusted earnings per share climbed 15% to $6.13. On a GAAP basis, net income grew just 3%, but earnings per share climbed 11% to $4.62. In short, fewer shares drove about half of the quarter's adjusted per-share growth. If Adobe spent all $24.55 billion at roughly $240 a share and its earnings stayed flat, retiring about 26% of its shares would raise earnings per share by over a third. That won't happen all at once, and the price Adobe pays will move. A lower stock price would stretch the cash further, and a higher one would shrink it. At roughly $240, Adobe shares cost about 13 times earnings. Using the midpoint of management's fiscal 2026 target for adjusted earnings per share ($24.45 to $24.50), the price is about 10 times adjusted earnings. When shares reached their 52-week high of $363.70, that same target worked out to almost 15 times adjusted earnings. I'd say buying back stock at about 10 times adjusted earnings is one of the better uses of Adobe's cash right now. True, a buyback can't fix slowing growth. Adobe's total annualized recurring revenue (ARR), its gauge of the subscription business on a yearly basis, rose 11.2% year over year in fiscal Q3, and management's full-year target is 10.2%. And the market's discount probably reflects worries that artificial intelligence tools might hurt Adobe's pricing power. But as long as the subscription business keeps growing, a falling share count should help earnings per share outpace the business itself. All in all, I think the buyback makes a cheap stock more interesting. Adobe stock looks worth considering at this price, but I'd want the subscription business to keep growing at roughly its current pace. Before you buy stock in Adobe, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Adobe wasn't one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $361,650!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,437,517!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of October 4, 2026. Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Adobe. The Motley Fool recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy. Adobe Still Has $24.5 Billion Left for Buybacks. That's About a Quarter of the Company. was originally published by The Motley Fool

- S&P 500 earnings are expected to jump 26% in Q3 after a 51% surge in Q2. - Morningstar projected, citing Goldman Sachs research, that earnings growth could slow to 11% in 2027 and 2028. - AI is also blurring the line between growth and value stocks, with Intel and Applied Materials moving to growth in a Morningstar index, while Adobe, Uber, and Intuit are shifting toward value. The AI boom is doing more than lifting tech stocks; it is becoming a major driver of corporate earnings, raising questions about how sustainable the profit surge will be as Wall Street heads into the third-quarter reporting season. Morningstar, citing Goldman Sachs research, said in a new report that S&P 500 earnings are expected to rise 26% in the third quarter, following a massive 51% jump in Q2. Still, Goldman expects earnings growth to slow, forecasting about 11% growth in both 2027 and 2028. "Their takeaway: We aren't quite in an earnings bubble," Morningstar said in its report. See what 10M+ investors are talking about. Get the Stocktwits Daily Rip for what retail is watching right now, free to your inbox Morningstar analysts said AI capital expenditure, semiconductor margin expansion and gains from private investments are the top three factors currently supporting earnings that could eventually become headwinds. That puts companies such as Nvidia, Broadcom, Dell Technologies and Applied Materials, among others in focus, with hyperscalers continuing to pour billions of dollars into data centers, chips and computing infrastructure. Morningstar also highlighted a growing debate around whether the AI investment boom is pushing up Treasury yields by "crowding out" government debt. Pimco's analysis, however, challenges that argument, finding little evidence that individual AI-related debt deals have meaningfully moved Treasury yields. The AI bubble debate remains sharply divided. Michael Burry has questioned the sustainability of Big Tech's AI spending and financing, and believes the returns on investment might not be enough. Nvidia CEO Jensen Huang, by contrast, argues that AI has entered a "high production ramp" as products become useful and generate revenue, pushing back on the idea that the industry is simply hype. The market, too, is flashing some caution. Nvidia, the biggest beneficiary of the AI chip boom, has lagged the broader tech trade this year, while Big Tech cloud stocks are only now regaining momentum. Year to date, the Invesco QQQ Trust Series 1 (QQQ) has gained 21.6%, and the iShares Semiconductor ETF (SOXX) has risen 9.5%, with stocks such as Micron, SanDisk, Seagate, Intel, and Dell more than tripling. Meanwhile, AI is reshaping how investors classify technology stocks. Intel and Applied Materials have moved toward Morningstar's growth indexes as AI-driven demand improves their growth profiles, while Uber, Intuit and Adobe have shifted toward value after uncertainty around AI's impact on software weighed on their growth prospects. Dell offers another example. Its large-cap classification was split between growth and value after its growth metrics improved, even as it remained in the mega-cap value category against faster-growing giants such as Nvidia and Broadcom. Morningstar said that while AI remained a powerful earnings engine, investors may increasingly distinguish between profits generated by the current spending boom and sustainable earnings growth once that investment cycle matures. For updates and corrections, email newsroom[at]stocktwits[dot]com. Read Next: Stocktwits Tech Watch: Micron's Q4 Report, OpenAI Developer Conference Keep AI Trade In Focus This Week Yuvraj Malik has no position in any of the stocks mentioned in this article. StockTwits' news team content is for informational purposes only and is not intended as investment advice. For more, see our editorial policy. This article was originally published on StockTwits. Related: - MDB Stock Plunges After CEO Leaves For Meta – Analysts Weigh Enterprise Ties Against Ittycheria Return - MDB Stock Plunges After CEO Leaves For Meta – Analysts Weigh Enterprise Ties Against Ittycheria Return - SpaceX's Starship Reaches Orbit For First Time – Retail Calls It 'History In The Making'

Chicago, IL – September 28, 2026 – Zacks.com releases the list of companies likely to issue earnings surprises. This week's list includes Nvidia NVDA, Micron MU, Alphabet GOOGL, Oracle ORCL and Adobe ADBE. What Will Q3 Earnings Season Show? The overall setup remains very favorable as we look ahead to the Q3 earnings season. The expectation is that S&P 500 earnings will increase by +23.9% from the same period last year, the 8th straight quarter of double-digit earnings growth for the index. The Tech sector remains a major growth contributor, but momentum is broad-based, with 14 of the 16 Zacks sectors on track for positive earnings growth in Q3. Importantly, the revisions trend remains positive and broad-based, highlighting a steadily improving outlook. As noted earlier, the revisions trend has been positive, sustaining the favorable trend in place for almost a year.  This positive revisions behavior is not a new development; it extends a tailwind that has been building for nearly a year. The positive revisions were initially concentrated in Technology and, more recently, Energy following Middle East supply disruptions. However, for Q3 2026, the constructive estimate revisions have broadened significantly, rising across 8 of the 16 Zacks sectors—including Transportation, Finance, Aerospace, Industrials, Utilities, and Autos alongside Tech and Energy. On the negative side, Q3 estimates have been under pressure for these 8 sectors since the quarter got underway – Conglomerates, Basic Materials, Consumer Staples, Consumer Discretionary, Medical, Business Services, Retail, and Construction. It is important to note that estimates for 2026 Q4 and full-year 2027 have also been trending higher lately. Sector Focus: Broad-Based Strength Q3 earnings are expected to be above the year-earlier level for 14 of the 16 Zacks sectors, with 6 sectors expected to enjoy double-digit growth. The Conglomerates and Consumer Staples sectors are the only ones expected to have lower earnings in Q3 relative to the same period last year, with Conglomerates earnings expected to be down –35.4% and Consumer Staples earnings expected to be down -0.2%. The 6 sectors expected to enjoy double-digit earnings growth in Q3 are Aerospace (up +159.5%), Energy (+111.5%), Tech (+41.9%), Basic Materials (+29.6%), Transportation (+14.9%) and Industrial Products (+13.2%). Q3 earnings growth for the S&P 500 index drops to +19.9% from +23.9% once the Energy sector's contribution is excluded from the index. Excluding the Tech sector, Q3 earnings growth for the rest of the index drops to +14.4%. Nvidia, Micron and Alphabet have been enjoying a record earnings run in recent quarters, and that performance continues in Q3 as well. Nvidia's Q3 earnings are expected to increase +90% year-over-year on +91.2% higher revenues, while the year-over-year earnings and revenue growth for Micron is expected to be +938% and +349.5%, respectively. Importantly, both companies are enjoying a steadily improving outlook, with analysts consistently raising their estimates. We should keep in mind that Micron is scheduled to report quarterly results for its fiscal quarter ending in August on Wednesday, September 30th. Unlike Nvidia and Micron, Alphabet's Q3 earnings are expected to be up only +2.1% from the same period last year on +27.2% higher revenues. Q3 earnings growth for the Tech sector gets cut by slightly more than half once contributions from Nvidia, Alphabet, and Micron are excluded. Q3 Earnings Season Scorecard The Q3 earnings season will get the spotlight when the big banks report on October 13th, but the reporting cycle actually got underway with the September 10th quarterly releases from Oracle and Adobe. The Oracle and Adobe reports were for these Tech companies' fiscal quarters ending in August, which get counted as part of the September-quarter tally. Including Oracle and Adobe, we now have such Q3 results from 9 S&P 500 members. We have 7 additional index members on deck to report their fiscal August-quarter results this week, including Nike, Micron, Accenture, and others. Total Q3 earnings for the 9 S&P 500 members that have reported results already are up +16.3% from the same period last year on +11% higher revenues, with 66.7% beating EPS estimates and an equal proportion beating revenue estimates. For a detailed view of the evolving earnings picture, please check out our weekly Earnings Trends report here >>>> Earnings Outlook Remains Upbeat: A Closer Look  Why Haven't You Looked at Zacks' Top Stocks? Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year. Today you can access their live picks without cost or obligation. See Stocks Free >> Join us on Facebook:  https://www.facebook.com/ZacksInvestmentResearch/ Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. 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All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Micron Technology, Inc. (MU) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Oracle Corporation (ORCL) : Free Stock Analysis Report Adobe Inc. (ADBE) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The overall setup remains very favorable as we look ahead to the Q3 earnings season. The expectation is that S&P 500 earnings will increase by +23.9% from the same period last year, the 8th straight quarter of double-digit earnings growth for the index. The Tech sector remains a major growth contributor, but momentum is broad-based, with 14 of the 16 Zacks sectors on track for positive earnings growth in Q3. Importantly, the revisions trend remains positive and broad-based, highlighting a steadily improving outlook. The quarterly chart below details actual results alongside Q3 2026 growth expectations and forward projections. Image Source: Zacks Investment Research As noted earlier, the revisions trend has been positive, sustaining the favorable trend in place for almost a year. The chart below shows how 2026 Q3 earnings growth expectations have evolved lately. Image Source: Zacks Investment Research This positive revisions behavior is not a new development; it extends a tailwind that has been building for nearly a year. The positive revisions were initially concentrated in Technology and, more recently, Energy following Middle East supply disruptions. However, for Q3 2026, the constructive estimate revisions have broadened significantly, rising across 8 of the 16 Zacks sectors—including Transportation, Finance, Aerospace, Industrials, Utilities, and Autos alongside Tech and Energy. On the negative side, Q3 estimates have been under pressure for these 8 sectors since the quarter got underway – Conglomerates, Basic Materials, Consumer Staples, Consumer Discretionary, Medical, Business Services, Retail, and Construction. It is important to note that estimates for 2026 Q4 and full-year 2027 have also been trending higher lately. Q3 earnings are expected to be above the year-earlier level for 14 of the 16 Zacks sectors, with 6 sectors expected to enjoy double-digit growth. The Conglomerates and Consumer Staples sectors are the only ones expected to have lower earnings in Q3 relative to the same period last year, with Conglomerates earnings expected to be down –35.4% and Consumer Staples earnings expected to be down -0.2%. The 6 sectors expected to enjoy double-digit earnings growth in Q3 are Aerospace (up +159.5%), Energy (+111.5%), Tech (+41.9%), Basic Materials (+29.6%), Transportation (+14.9%) and Industrial Products (+13.2%). Q3 earnings growth for the S&P 500 index drops to +19.9% from +23.9% once the Energy sector's contribution is excluded from the index. Excluding the Tech sector, Q3 earnings growth for the rest of the index drops to +14.4%. The chart below shows the Q3 earnings and revenue growth expectations for the Tech sector relative to what we saw in the preceding two periods and what is expected in the following three quarters. Image Source: Zacks Investment Research Nvidia NVDA, Micron MU, and Alphabet GOOGL have been enjoying a record earnings run in recent quarters, and that performance continues in Q3 as well. Nvidia's Q3 earnings are expected to increase +90% year-over-year on +91.2% higher revenues, while the year-over-year earnings and revenue growth for Micron is expected to be +938% and +349.5%, respectively. Importantly, both companies are enjoying a steadily improving outlook, with analysts consistently raising their estimates. We should keep in mind that Micron is scheduled to report quarterly results for its fiscal quarter ending in August on Wednesday, September 30th. Unlike Nvidia and Micron, Alphabet's Q3 earnings are expected to be up only +2.1% from the same period last year on +27.2% higher revenues. Q3 earnings growth for the Tech sector gets cut by slightly more than half once contributions from Nvidia, Alphabet, and Micron are excluded, as the chart below shows. Image Source: Zacks Investment Research The Q3 earnings season will get the spotlight when the big banks report on October 13th, but the reporting cycle actually got underway with the September 10th quarterly releases from Oracle ORCL and Adobe ADBE. The Oracle and Adobe reports were for these Tech companies' fiscal quarters ending in August, which get counted as part of the September-quarter tally. Including Oracle and Adobe, we now have such Q3 results from 9 S&P 500 members. We have 7 additional index members on deck to report their fiscal August-quarter results this week, including Nike, Micron, Accenture, and others. Total Q3 earnings for the 9 S&P 500 members that have reported results already are up +16.3% from the same period last year on +11% higher revenues, with 66.7% beating EPS estimates and an equal proportion beating revenue estimates. The comparison charts below show the earnings and revenue growth rates for these companies compared to other recent periods. Image Source: Zacks Investment Research The comparison charts below show the Q3 EPS and revenue beats percentages for these companies compared to other recent periods. Image Source: Zacks Investment Research The chart below shows the aggregate growth picture for the S&P 500 index on a calendar year basis. Image Source: Zacks Investment Research For a detailed view of the evolving earnings picture, please check out our weekly Earnings Trends report here >>>> Earnings Outlook Remains Upbeat: A Closer Look Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Micron Technology, Inc. (MU) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Oracle Corporation (ORCL) : Free Stock Analysis Report Adobe Inc. (ADBE) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Adobe Systems (ADBE) reported strong revenue and free cash flow results for fiscal Q3 on Sept. 10. Free cash flow (FCF) margins were over 40% over the past year. ADBE stock is dirt cheap now at less than 10x earnings and 10x trailing 12-month (TTM) FCF. As a result, shorting ADBE puts and put credit spreads work well for value investors. ADBE closed at $265.60 on Monday, Sept. 14, up from a recent trough of $248.83 on Sept. 10 before the earnings release. However, the chart below from Barchart shows ADBE has been flat for the past month and a half. Goldman Sachs Expects Fed Chair Kevin Warsh to Raise Rates This Week — But Not Because of Oil Prices. What Old-School Chart Analysis and Gamma Exposure Tell Us About QQQ This Fed Week Unusually High Volume in Deep Out-of-the-Money Vertiv Call Options Shows Investors Bullish on VRT Stop Missing Market Moves: Get the FREE Barchart Brief – your midday dose of stock movers, trending sectors, and actionable trade ideas, delivered right to your inbox. Sign Up Now! This is likely due to investors' fears that some AI company will eat Adobe's lunch and steal its clients with an AI bot or lower pricing structure. So far, that hasn't happened. In fact, revenue for the fiscal Q3 quarter ending Aug. 28, 2026, was up 12.9% YoY and over 2.1% QoQ. Moreover, its trailing 12-month revenue (TTM), at $25.97 billion, was 12% higher YoY and 3% higher than last quarter's TTM revenue of $25.198 billion. This data comes from Stock Analysis. In other words, Adobe is not losing its customer base to AI bots. In addition, its pricing structure remains strong, allowing Adobe to generate over 40% TTM FCF margins. For example, in fiscal Q3, Adobe generated $2.438 billion in FCF, vs. $2.1 billion last quarter, and $2.126 billion last year. This resulted in FCF margins (i.e., FCF as a percentage of revenue) of 36.1%, 31.8%, and 35.5%, respectively. More importantly, given that much of its FCF comes in Q4, Adobe's trailing 12-month (TTM) FCF this past quarter was $10.5 billion. That represented 40.79% of its TTM revenue. That compares to 40.8% last quarter and 41.4% last year. In other words, over the past year, its FCF margins have remained strong, despite competition from AI companies. There is every reason to believe this will continue. For example, analysts surveyed by Seeking Alpha now expect revenue for the year ending Nov. 30, 2026, to hit $26.61 billion, up from $23.769 billion last year. But next year it's expected to rise to $29.05 billion. That's an implied growth rate of 22.2% over 2 years, or 10.1% annually. Moreover, if we assume Adobe will keep generating 40.8% FCF margins, its FCF will rise to $11.85 billion next year, up from $10.5 billion over the past year. That implies a 12.9% FCF growth rate over the coming year. This should help push Adobe's valuation much higher. Right now, ADBE stock is trading at a forward price/earnings (P/E) multiple of less than 10x, as analysts project earnings per share (EPS) of $27.66 for next year. Similarly, its trailing 12-month (TTM) FCF of $10.5 billion represents a 10% FCF yield, as ADBE's market cap is $105.6 billion. In other words, ADBE is 10x its TTM FCF. So, at 10x, its 2027 $11.85 billion FCF would give Adobe a fair market value (FMV) of $118.5 billion, or 12.2% higher. However, let's assume the market eventually raises this multiple to at least 12x (i.e., an 8.33% FCF yield); here is what ADBE could be worth: 12x $11.85 billion = $142.2 billion fair market value (FMV) That is +34.7% over today's market cap of $105.6 billion. This means ADBE stock could be worth between 12.2% and 34.7% more over the next year, or 23.5% more: $265.60 x 1.235 = $328 price target (PT) That's slightly higher than other analysts, as Yahoo! Finance shows that the average of 40 analysts is $279.05, and Barchart's mean survey PT is $268.82. However, there's no guarantee ADBE will reach these PTs. So, one conservative way to play ADBE is to short out-of-the-money (OTM) puts and do put credit spreads. For example, the Oct. 16 expiry put option chain shows that the $245 put has a midpoint premium of $4.70, and the $240 put has a midpoint premium of $3.60. This means the first play is that an investor who posts $24,500 with their brokerage firm can collect $470 in their account by entering an order to “Sell to Open” the $245.00 put. That works out to a one-month yield of 1.918% (i.e., $470/$24,500), and, if repeated each month for a year, the expected return is 23.0%as long as ADBE stays above $245.00. Even if it does, the brokerage will assign the $24.5K collateral to buy 100 shares at $245.00. That is a great buy-in price, and it allows the investor to benefit from any upside in ADBE. Moreover, they could also sell covered calls. However, not all investors have $24,500 to post as collateral for this play. One way around that is to do a put credit spread. In this play, the investor executes the short-put trade but also buys a lower put strike price in the same expiry period. That way, the collateral required is limited. For example, after buying the $240.00 put in the chain above, the investor spends $360 of the $470 already received, for a net credit of $110. So, the net spread is $5, and the collateral is $500. Here is the expected return: $110 net credit / $500 collateral spread = 22% So, for example, if the investor has just $5,000 to invest, they could short 10 contracts at $245 and buy 10 contracts simultaneously at $240. Here is how that works out: $4,700 -$3,600 = $1,100 net credit $1,100 / $5,000 collateral = 22% Note, however, that if ADBE falls to $240 on or before, the investor could lose $5,000 in collateral. The net loss would be $5,000 -$1,100, or $3,900. So, the investor will have to close this out or roll it over to a new period, perhaps at lower strike prices, to avoid this. In other words, the risk of loss is much higher than with a short-put play. However, the upside is huge. For example, if this play is done for 3 months, the expected return is over 66%. But, given how cheap ADBE is, there is likely a low risk that this would occur, other than a large market event. The bottom line is that these are two profitable ways to play ADBE stock for value investors each month. On the date of publication, Mark R. Hake, CFA did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com

Adobe ADBE reported better-than-expected third-quarter fiscal 2026 results, with revenue and adjusted earnings surpassing Wall Street estimates. The software giant also raised its full-year targets, supported by steady subscription growth and increasing adoption of artificial intelligence (AI)-powered products. However, a softer-than-expected fourth-quarter revenue outlook has raised concerns about Adobe’s competitive standing as rivals like Figma and Canva expand their AI design capabilities. Adobe generated $6.76 billion in third-quarter revenue, up 12.9% year over year and ahead of the Zacks Consensus Estimate by 1.02%. Non-GAAP earnings came in at $6.13 per share, rising 15.4% year over year and beating the consensus estimate by 0.82%. GAAP earnings were $4.62 per share, up 11% year over year. The company’s total ending annualized recurring revenue (ARR) reached $27.50 billion, increasing 11.2% year over year. AI-first ending ARR exceeded $650 million, growing more than 150% year over year. Subscription revenue totaled $6.58 billion, up 13.7% year over year and accounting for 97.4% of total revenue. Product revenue declined 1.5% to $67 million, while services and other revenue fell 14% to $111 million. Adobe’s AI business continued to expand during the quarter. Firefly ending ARR across the Firefly App and Firefly credit packs increased 40% sequentially, while AI-first ARR more than doubled year over year. The company is also extending Acrobat capabilities to platforms such as ChatGPT, Chrome, Claude, Microsoft Edge and WhatsApp. Adobe’s strong revenue growth was accompanied by rising operating expenses. GAAP gross margin declined to 88.7% from 89.3% in the year-ago quarter. Operating expenses increased 14.8% year over year to $3.64 billion. Cash flow from operations reached a third-quarter record of $2.52 billion, up 14.8% year over year. Adobe ended the quarter with $5.64 billion in cash and short-term investments. Remaining performance obligations totaled $22.16 billion, up 8% year over year, while current RPO increased 9%. Adobe repurchased approximately 9.5 million shares during the quarter and ended the period with about $24.55 billion remaining under its April 2026 repurchase authorization. Adobe expects fourth-quarter fiscal 2026 revenue of $6.80-$6.85 billion, with non-GAAP earnings projected at $6.30-$6.35 per share. The company expects a non-GAAP operating margin of approximately 44%. Business Professionals & Consumers subscription revenue is forecast at $1.93-$1.95 billion, while Creative & Marketing Professionals subscription revenue is expected to reach $4.665-$4.695 billion. For fiscal 2026, Adobe raised its revenue target to $26.576-$26.626 billion and its non-GAAP earnings outlook to $24.45-$24.50 per share. The company expects a non-GAAP operating margin of approximately 45%. Ending ARR growth is projected at 10.2% year over year, based on the fiscal 2026 beginning book of business of $25.66 billion. However, the fourth-quarter revenue outlook fell slightly short of Wall Street’s $6.85 billion midpoint expectation, per tikr.com. The softer guidance has raised questions about Adobe’s ability to maintain its growth momentum as competition intensifies. Adobe’s Q3 results highlight resilient subscription growth, accelerating AI adoption and strong cash generation. However, rising costs and intensifying competition in AI-powered design tools can pose threats. Hence, investors can play the stock with ETFs. The ETF approach minimizes the company-specific concentration risks. Adobe-heavy ETFs include Fidelity Metaverse ETF FMET, Invesco Next Gen Media and Gaming ETF GGME, ARIA Opportunities ETF ARIA and Motley Fool Value Factor ETF MFVL. Adobe accounts for about 4% of each fund. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Adobe Inc. (ADBE) : Free Stock Analysis Report Fidelity Metaverse ETF (FMET): ETF Research Reports Invesco Next Gen Media and Gaming ETF (GGME): ETF Research Reports Motley Fool Value Factor ETF (MFVL): ETF Research Reports This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research