Why This Adobe Analyst Is Turning Bullish Ahead Of Q3 Earnings

Shares of Adobe Inc ADBE have been in focus ahead of the company’s fiscal third-quarter earnings release.

Enterprise checks suggest a “generally healthy” performance in the fiscal third quarter and a “much better” performance in the fourth, according to Mizuho Securities.

The Adobe Analyst: Gregg Moskowitz upgraded the rating for Adobe from Neutral to Buy, while raising the price target from $520 to $630.

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The Adobe Thesis: With meaningful acceleration in web traffic, the company is likely to exceed the fiscal third-quarter estimate for net new Digital Media ARR (average recurring revenue), Moskowitz said in the upgrade note.

Enterprise checks indicated “strong large deal activity next quarter (ADBE's F4Q), for the first time in many quarters,” the analyst stated. “Firefly will significantly benefit ADBE's financials in the Digital Media and Digital Experience segment,” he added.

Moskowitz expressed optimism around GenAI being “a significant growth driver” for Adobe.

ADBE Price Action: Shares of Adobe had risen by 1.13% to $566.80 at the time of publication Friday.

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