Adobe (ADBE) PT Raised to $610 After Raising Guidance Earlier than Usual - Jefferies

March 24, 2021 8:10 AM EDT
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Price: $507.29 -0.99%

Rating Summary:
    31 Buy, 14 Hold, 0 Sell

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    Up: 2 | Down: 4 | New: 39
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Jefferies analyst Brent Thill raised the price target on Adobe (NASDAQ: ADBE) to $610.00 (from $600.00) while maintaining a Buy rating after the company delivered a strong beat across all 3 Clouds. It raised FY guide, which is unusual this early in yr. ADBE is seeing cont'd recovery among SMBs, while mid-market & enterprise clients are investing in digital transformation. The FY21 rev guide was raised by $300M
to $15.45Bn, +20% y/y and assumes continued recovery of SMBs but does not embed any macro acceleration.

The analyst stated "All 3 Cloud segments beat soundly, even taking into account the extra week in FQ1. Digital Media (DM) revs grew 32% vs. 26% guide, driven by Creative Cloud +31% and Document Cloud +37%. Net new DM ARR $435M was ahead of $410M guide. FY21 ARR guide was increased by $50M to $1.8Bn, which would still be a decline from FY20's $1.85Bn; note that new ARR has increased every yr since FY16. Digital Experience (DX) +24% beat 19% guide as both mid-market and enterprise clients are choosing ADBE for their digital transformation. The Workfront acquisition is also off to a fast start with rev $38M vs. $25M guide."

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