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After Adobe’s guidance came in below expectations, we checked the stock’s valuation against its historical averages and didn’t find it to be compelling. After further share price erosion, Piper Jaffray did the same and now finds limited downside:

“A look at Adobe valuation ranges over the last three years shows that the stock is within 7% of trough valuation and 52% below peak valuation, based on current Street earnings-per-share estimates,” wrote Piper analyst Gene Munster.

Adobe (ADBE) is down 15% since the company guided down second-quarter earnings. Munster suspects investors are worried that Adobe will lower numbers again when it announces results on June 15.

As always, investors should do their own research. But the valuation is getting cheaper, and Adobe remains in the sweet spot of the digital consumer migration.

ADBE 1-yr chart:


Source: Adobe Valuation Becoming Attractive? (ADBE)