Today’s Stock: Adobe Inc.
We all know what adobe does. Photoshop and PDF. Massive business that impacts our lives every day. The digital media powerhouse.
My Thoughts 💭
Adobe is a solid company. A PE at 21 makes it fair price. They have a massively profitable business. I been buying this stock the past 4 years as part of an experiment I am running and I am down 22%. Investors hate this stock due to AI and the idea that Adobe is falling behind. Plus they don’t pay a dividend as well. At 373k sats per share (@ $91,151) you are hoping that Adobe grows more than bitcoin does but I don’t think it will. AI is tremendous headwind and investors have been worried about Adobe’s approach to AI so much that they been dumping the stock when the business has a 30% profit margin and a great balance sheet!
PE:
Expected Growth :
Revenues and expenses:
Balance Sheet:
Dividend:
None
Bitcoin per share
ZERO
Ownership breakdown
Leadership
Boomers and Gen X still run the world! Looking into this business it’s hard not to buy this from a value standpoint. Great revenues, slightly over price but manageable, 30% profit margin great balance Sheet. Almost $10B in free cash flow but yet the stock has been selling off these last few years.
Taking a look how they generate revenue:
Given our heavy reliance on digital platforms, it’s understandable that investors in generative AI might believe Adobe’s demise is inevitable. However, I find this notion unconvincing. Adobe’s AI capabilities utilize data from PDFs and export results back to PDFs. Considering Adobe’s current stock price of 373k sats per share and its decision to withhold dividends, I lack any compelling reason to invest in this stock. Unlike essential resources like water and housing, I believe the world would function relatively well even if Adobe were to cease operations.