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S&P 500 (NYSE:SPY) component Adobe Systems (NASDAQ:ADBE) will unveil its latest earnings on Tuesday, June 19, 2012. Adobe Systems offers a line of creative, business, web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.
Adobe Systems Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average estimate of analysts is for net income of 48 cents per share, a rise of 20% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 10.6% versus last year to $1.99.
Past Earnings Performance: Last quarter, the company fell short of estimates by 2 cents, coming in at profit of 42 cents per share against a mean estimate of net income of 46 cents. The company topped expectations in the fourth quarter of the last fiscal year.
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A Look Back: In the first quarter, profit fell 21.1% to $185.2 million (37 cents a share) from $234.6 million (46 cents a share) the year earlier, missing analyst expectations. Revenue rose 1.7% to $1.05 billion from $1.03 billion.
Wall St. Revenue Expectations: On average, analysts predict $1.11 billion in revenue this quarter, a rise of 8.8% from the year-ago quarter. Analysts are forecasting total revenue of $4.5 billion for the year, a rise of 6.6% from last year’s revenue of $4.22 billion.
Stock Price Performance: Between March 19, 2012 and June 13, 2012, the stock price fell $2.72 (-7.9%), from $34.51 to $31.79. The stock price saw one of its best stretches over the last year between March 20, 2012 and March 27, 2012, when shares rose for six straight days, increasing 4.4% (+$1.47) over that span. It saw one of its worst periods between July 22, 2011 and August 2, 2011 when shares fell for eight straight days, dropping 9.1% (-$2.69) over that span.
On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 8.5% in the second quarter of the last fiscal year, 2.3% in the third quarter of the last fiscal year and 14.3% in the fourth quarter of the last fiscal year before increasing again in the first quarter.
The company is trying to use this earnings announcement to rebound from profit declines in the last three quarters. Net income fell 15.2% in the third quarter of the last fiscal year, by 35.4% in the fourth quarter of the last fiscal year and again in the first quarter.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.14 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.
Analyst Ratings: With 11 analysts rating the stock as a buy, one rating it as a sell and 11 rating it as a hold, there are indications of a bullish outlook.
(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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