Adobe Inc. (ADBE)

FairStock Score: 83/100 — HIGH CONVICTION

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I begin with quality and staying power. Adobe's figures show a high-return software business: in fiscal Q3 2026, the quarter ended 2026-08-28, revenue was $6.8B and net income $1.8B, a 27.03% margin. For FY2025, revenue was $23.8B versus $21.5B in FY2024, and FY2025 net income was $7.1B. FairStock calculates ROE of 61.90%, ROCE of 19.73%, Piotroski 8/9, Altman Z 6.12, and debt/equity 0.57; those are signs of financial strength. The high margins and returns suggest a moat, but slowing profit growth tempers it. Cash is the clearest attraction: trailing free cash flow is $10.6B, a 10.5% FCF yield on the $100.7B market cap. At the $258.62 close on 2026-10-26, FairStock also shows P/E 14.43, EV/EBITDA 10.20, and P/B 8.68. Graham would be less comfortable: the Graham Number is $109.02, with a -141.99% margin of safety, so the price is not cheap on asset-and-earnings tests. Growth is mixed. Fiscal Q3 2026 revenue rose to $6.8B from $6.0B in fiscal Q3 2025, but net income was $1.8B in both quarters, and EPS rose to $4.62 from $4.18. FairStock's computed Lynch category is SLOW GROWER, citing 6.3% yearly profit growth over five years against 13.1% revenue growth; PEG is 4.75. I see a strong business with excellent cash returns, but profit growth has not kept pace with revenue, and the price demands more than the Graham tests support.

In plain English: Adobe sells software for creating and publishing content and for digital marketing. The business looks strong: it earns high profits on its sales, turns a lot of sales into cash, and has manageable debt. The price looks high against slower profit growth and old-fashioned value tests, though it looks more reasonable against the cash the business produces.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q3 2026 10-Q (period ended 2026-08-28) · fiscal Q2 2026 10-Q (period ended 2026-05-29) · fiscal Q1 2026 10-Q (period ended 2026-02-27) · fiscal Q3 2025 10-Q (period ended 2025-08-29) · FY2025 10-K (period ended 2025-11-28) · FY2024 10-K (period ended 2024-11-29) · FY2023 10-K (period ended 2023-12-01)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer