Adobe is not re-accelerating: management guides growth down to 9-10% with operating margins falling, and more pressure lies ahead. That makes buying every dip at about 16x earnings a mistake, even as @qualtrim points to 12% revenue growth and a 47.4% operating margin. x.com  x.com 

Adobe could easily go the way of PayPal, its best analog: a mature consumer-facing large-cap tech company that attempted a poorly received large acquisition as growth stalled, then changed executives. Growth is likely to decelerate further amid pricing pressure, buybacks won't matter much in the short term, and more talent will leave once a CEO is picked. The stock is only optically cheap. x.com  x.com 

Adobe is showing it can monetize AI, undercutting the bear case. AI ARR passed $650M and more than doubled year on year, monthly active users crossed 1 billion, and Creative freemium users topped 100M, up over 70%. New customers include Amazon, IKEA, DHL, Marriott and Wells Fargo. Revenue rose 13% to $6.76B with heavy buybacks, yet the stock is valued almost for bankruptcy. Guidance rose only slightly, perhaps to set a low bar for new CEO Anil. x.com 

Adobe's 8x P/E signals that its outlook numbers are unreliable, its capital allocation is poor and it is likely a casualty of AI. It spent all its free cash flow buying back shares at $400 and is on a direct collision course with AI; no one can say its products will be as crucial as in the last two decades. Unlike Meta in 2022, whose ads business was never impaired, there are too many unknowns. It could work or stagnate for years, so it sits in the too-hard bucket even if multiples scream buy. … Show more

Adobe is best avoided because a very low valuation comes with a highly uncertain future, making the situation amazingly complex. x.com 

Adobe's cash generation and growing AI subscriptions give its tentative turnaround fundamental support. It has $10.59B in free cash flow; revenue and EPS are expected to grow at double-digit rates through 2028, while AI-first ARR is up 150% year over year and Firefly ARR 40% quarter over quarter. Its Stage 1 base is attempting to break a long downtrend. x.com 

Adobe's stock is unattractive to investors while the AI rally dominates, even though the company itself is nowhere near dying. Once the AI ride cools off a bit, Adobe can see some rebound. x.com 

Adobe's creative moat is under direct siege from frontier AI models, and a leadership change away from its creative franchise compounds the risk. Agent workflows disintermediate Creative Cloud at the low-to-mid end, and Adobe is spending to retain users rather than add net new subscriptions. Incoming CEO Anil Chakravarthy comes from enterprise customer experience while creative chief David Wadhwani leaves, while Creative and Marketing is 71%+ of subscription revenue. A $160 target stands. x.com  … Show more

Adobe is a bit undervalued, though not significantly, at 13x earnings with 13% revenue growth. Its falling profit margin is concerning, and AI threats are growing as image generation improves. x.com 

Adobe's record 12.72% free cash flow yield shows it is cheap, but not yet that the selling is over. That yield, more than triple its norm, signals the market expects AI to shrink its cash flows over the coming years. Forward earnings have more than doubled in five years while the forward P/E fell from about 50x to 15x. A cheap stock can stay cheap; it takes a few quarters of steady revenue and growing cash flow to prove the AI fear wrong, with buybacks gaining power the longer it stays low. … Show more