Tuesday, April 26, 2011

Stock Idea: Adobe Systems Inc. (ADBE, $33.13)

(May 16, 2011 update: All future stock posts will appear on my new subscription-only website at www.GoodfellowLLC.com. Please visit!)

Adobe Systems Inc. (ADBE) offers a range of business, Web and mobile software and services.

Projected consensus EPS growth is +15.5%, +13.9% and +11.8% for fiscal years 2011 through 2013. The PE is 14.9. Adobe does not pay a dividend.

I've been waiting for weeks for Adobe Systems (ADBE) to bounce down to $33, which I consider a good buy price. The stock closed today at $33.13. In the immediate future, I expect the stock to trade in the $33 to $35 area, then move towards $37/38, where it will meet with some resistance, on its way to retracing its pre-financial meltdown high near $48.

Here's some data on the company:

Adobe Systems (Nasdaq: ADBE ) just released the first major revision of its Audition package, formerly known as Cool Edit Pro, since 2007. Audition is now part of Adobe's flagship Creative Suite for the first time. That's a rival not to be taken lightly. -- The Motley Fool, April 26, 2011

Standard & Poor's maintains a current target price of $35 and a fair market calculation of $44.80. "We are encouraged by recent strength in sales of products such as Acrobat and Creative Suite, as well as growth in subscriptions. However, we are concerned about slower growth from Japan, ADBE's second largest geographic region, given recent events." -- Standard & Poor's, 04/23/11

Read: 10 Jim Cramer Sell Ideas Gone Wrong -- www.SeekingAlpha.com

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