Parcion Private Wealth Reduces Adobe Holdings Amid Analyst Downgrades

Parcion Private Wealth LLC has decreased its stake in Adobe Inc. (NASDAQ: ADBE) by 9.4% during the second quarter of 2023. According to the firm’s latest Form 13F filing with the Securities and Exchange Commission, Parcion now holds 1,325 shares of the software company, having sold 137 shares during the reporting period. The value of Parcion’s holdings in Adobe stands at approximately $513,000 as of the latest reporting.

Other institutional investors have also made adjustments to their positions in Adobe. Brighton Jones LLC increased its stake by 2.1% in the fourth quarter, resulting in ownership of 8,068 shares valued at $3,588,000 after acquiring 167 additional shares. GAMMA Investing LLC raised its investment by 22.3% in the first quarter, now holding 7,798 shares worth $2,991,000 after purchasing 1,422 shares. GHP Investment Advisors Inc. and Legacy Advisors LLC also reported increases, acquiring 1,186 and 49 shares, respectively.

A significant portion of Adobe’s stock, approximately 81.79%, is held by institutional investors, reflecting strong confidence in the company’s long-term prospects despite recent fluctuations.

Analyst Ratings Reflect Caution

Recent reports from analysts indicate a cautious outlook for Adobe. Wall Street Zen downgraded the company from a “buy” to a “hold” rating on October 18, 2023. Similarly, Mizuho lowered its rating from “strong-buy” to “hold” on September 24, 2023. BMO Capital Markets adjusted its target price for Adobe from $450.00 to $405.00, maintaining an “outperform” rating.

In a more drastic move, Redburn Atlantic shifted its recommendation from “hold” to “strong sell,” slashing its target price from $420.00 to $280.00. Weiss Ratings reaffirmed a “hold” rating on Adobe shares on October 8, 2023, suggesting a mixed sentiment among analysts. Currently, one research analyst rates Adobe as a Strong Buy, while thirteen recommend a Buy, eleven suggest holding, and three advise selling.

MarketBeat.com reports that Adobe maintains an average rating of “Hold” with a target price of approximately $433.41.

Current Stock Performance and Earnings Report

On September 11, 2023, Adobe announced its quarterly earnings, reporting earnings per share (EPS) of $5.31, surpassing analysts’ expectations of $5.18 by $0.13. Revenue for the quarter reached $5.99 billion, exceeding forecasts of $5.91 billion. The company’s return on equity stood at 57.54% with a net margin of 30.01%. This revenue reflects an increase of 10.7% compared to the same quarter last year, with the previous year’s EPS at $4.65.

Looking ahead, Adobe has set its fiscal year 2025 guidance between $20.800 and $20.850 EPS, with a fourth-quarter guidance of $5.350 to $5.400 EPS. Analysts anticipate that Adobe will post an average of $16.65 earnings per share for the current fiscal year.

Adobe Inc. operates globally as a diversified software company, structured into three main segments: Digital Media, Digital Experience, and Publishing and Advertising. The Digital Media segment offers solutions for creating, publishing, and promoting content, alongside the Document Cloud platform for cloud-based document services.

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