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Adobe (ADBE) to Post Q4 Earnings: What's in the Offing?
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Adobe Inc. (ADBE - Free Report) is set to report fourth-quarter fiscal 2021 results on Dec 16.
For the fiscal fourth quarter, the company expects non-GAAP earnings of $3.18 per share. The Zacks Consensus Estimate for earnings is pegged at $3.18 per share, indicating growth of 13.2% from the year-ago reported figure.
Adobe projects total revenues of $4.07 billion. The consensus mark for the same is pegged at $4.08 billion, implying growth of 19.1% from the year-ago reported figure.
The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the earnings surprise being 7.52%, on average.
Adobe’s strong focus on its Digital Media business is anticipated to have aided the fiscal fourth-quarter performance.
The growing demand for the company’s Digital Media Solutions along with solid momentum across Creative Cloud and Document Cloud is expected to have benefited the Digital Media business in the to-be-reported quarter. For fourth-quarter fiscal 2021, Adobe expects year-over-year revenue growth of 20% from Digital Media.
The rising adoption of enterprise services and net new subscriptions is expected to have been positives.
A deepening focus on education is likely to have driven the company’s Creative annualized recurring revenues (ARR) in the quarter under review.
Solid enterprise adoption of Acrobat and Document Cloud services is anticipated to have driven growth in Document Cloud ARR.
Apart from Digital Media, Adobe’s strength in the Digital Marketing business is expected to have continued driving its top-line growth in the soon-to-be-reported quarter.
Strong momentum across Adobe Experience Cloud on the heels of the rising adoption of Adobe Marketing Cloud, Adobe Analytics Cloud and Adobe Advertising Cloud is expected to have benefited the business in the quarter under review. The company expects the Digital Experience segment’s revenues to grow 22% on a year-over-year basis.
The rising work-from-home trend is expected to have led to a further surge in demand for digital documents. Additionally, increasing demand for data and insights, content and personalization, customer journey management, commerce, and advertising are expected to have accelerated revenues in the fiscal fourth quarter.
However, lower end-market demand is anticipated to have been an overhang. Further, the impacts of high acquisition expenses are expected to get reflected in the upcoming results of the company.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Adobe this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Adobe has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell).
Stocks to Consider
Here are some stocks that you may consider as our model shows that these have the right combination of elements to beat on earnings.
Automatic Data Processing is expected to release second-quarter fiscal 2022 results on Jan 26, 2022. The Zacks Consensus Estimate for ADP’s earnings is pegged at $1.63 per share, suggesting an increase of 7.2% from the prior-year reported figure.
Bank of America (BAC - Free Report) has an Earnings ESP of +8.11% and a Zacks Rank #2 at present.
Bank of America is expected to release fourth-quarter fiscal 2021 results on Jan 19, 2022. The Zacks Consensus Estimate for BAC’s earnings is pegged at 59 cents per share, suggesting an increase of 32.2% from the prior-year reported figure.
Alaska Air Group (ALK - Free Report) has an Earnings ESP of +34.24% and a Zacks Rank #3 at present.
Alaska Air Group is expected to report fourth-quarter fiscal 2021 results on Jan 25, 2022. The Zacks Consensus Estimate for ALK’s earnings is pegged at 21 cents per share, suggesting an increase of 108.2% from the prior-year reported figure.
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Adobe (ADBE) to Post Q4 Earnings: What's in the Offing?
Adobe Inc. (ADBE - Free Report) is set to report fourth-quarter fiscal 2021 results on Dec 16.
For the fiscal fourth quarter, the company expects non-GAAP earnings of $3.18 per share. The Zacks Consensus Estimate for earnings is pegged at $3.18 per share, indicating growth of 13.2% from the year-ago reported figure.
Adobe projects total revenues of $4.07 billion. The consensus mark for the same is pegged at $4.08 billion, implying growth of 19.1% from the year-ago reported figure.
The company surpassed the Zacks Consensus Estimate in all the trailing four quarters, the earnings surprise being 7.52%, on average.
Adobe Inc. Price and EPS Surprise
Adobe Inc. price-eps-surprise | Adobe Inc. Quote
Factors to Consider
Adobe’s strong focus on its Digital Media business is anticipated to have aided the fiscal fourth-quarter performance.
The growing demand for the company’s Digital Media Solutions along with solid momentum across Creative Cloud and Document Cloud is expected to have benefited the Digital Media business in the to-be-reported quarter. For fourth-quarter fiscal 2021, Adobe expects year-over-year revenue growth of 20% from Digital Media.
The rising adoption of enterprise services and net new subscriptions is expected to have been positives.
A deepening focus on education is likely to have driven the company’s Creative annualized recurring revenues (ARR) in the quarter under review.
Solid enterprise adoption of Acrobat and Document Cloud services is anticipated to have driven growth in Document Cloud ARR.
Apart from Digital Media, Adobe’s strength in the Digital Marketing business is expected to have continued driving its top-line growth in the soon-to-be-reported quarter.
Strong momentum across Adobe Experience Cloud on the heels of the rising adoption of Adobe Marketing Cloud, Adobe Analytics Cloud and Adobe Advertising Cloud is expected to have benefited the business in the quarter under review. The company expects the Digital Experience segment’s revenues to grow 22% on a year-over-year basis.
The rising work-from-home trend is expected to have led to a further surge in demand for digital documents. Additionally, increasing demand for data and insights, content and personalization, customer journey management, commerce, and advertising are expected to have accelerated revenues in the fiscal fourth quarter.
However, lower end-market demand is anticipated to have been an overhang. Further, the impacts of high acquisition expenses are expected to get reflected in the upcoming results of the company.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Adobe this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Adobe has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell).
Stocks to Consider
Here are some stocks that you may consider as our model shows that these have the right combination of elements to beat on earnings.
Automatic Data Processing (ADP - Free Report) has an Earnings ESP of +0.75% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Automatic Data Processing is expected to release second-quarter fiscal 2022 results on Jan 26, 2022. The Zacks Consensus Estimate for ADP’s earnings is pegged at $1.63 per share, suggesting an increase of 7.2% from the prior-year reported figure.
Bank of America (BAC - Free Report) has an Earnings ESP of +8.11% and a Zacks Rank #2 at present.
Bank of America is expected to release fourth-quarter fiscal 2021 results on Jan 19, 2022. The Zacks Consensus Estimate for BAC’s earnings is pegged at 59 cents per share, suggesting an increase of 32.2% from the prior-year reported figure.
Alaska Air Group (ALK - Free Report) has an Earnings ESP of +34.24% and a Zacks Rank #3 at present.
Alaska Air Group is expected to report fourth-quarter fiscal 2021 results on Jan 25, 2022. The Zacks Consensus Estimate for ALK’s earnings is pegged at 21 cents per share, suggesting an increase of 108.2% from the prior-year reported figure.