Adobe stock (ADBE) is one of my favorite stocks to watch. In 2019 it has surged 36% ! In the words of President Trump “HUGE.” They have emerged as a creative software powerhouse and set up an impressive line of products, many of which are on a subscription model. On November 4, Adobe increased their guidance for 2020. CEO Shantanu Narayen said, “Our expanding universe of customers, strong global brand, market-leading products and continued innovation position us for a stellar 2020.”
Adobe shares are trading at a discount of 2.5% to a 52-week high of July 29, reflecting an uptrend from the end of October. This week, December 12, after the market closes, the company will report for the fourth quarter of fiscal 2019. The Wall Street expects a 20.5% YoY increase in revenue to $2.97 billion, with adjusted earnings per share increased by 23.5% YoY to $2.26. Over the past week, Adobe shares rose by 0.09%. The S&P 500 index for the same period increased by 1.27%.
Adobe Stock Support and Resistance
The shares stabilized after continued growth. The quotes are consolidating. There is no unidirectional trend observed. The key range is 297.00–310.00. In the near future, technical correction of the trading instrument is not ruled out. The signals of the indicators differ: the price fixed above MA (50) and MA (200); MACD began to decline. It is better to open the positions from the key levels. A comparative analysis of the multiples of the company and competing companies in the industry indicates the neutrality of #ADBE.
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Resistance levels: 310.00.
Support levels: 297.00, 289.00, 281.00.
Adobe Stock Trading Ideas
Long positions may be opened after the price consolidates above the level of 310.00. The closing of the profitable positions is possible at the levels of 320.00, 330.00 and 335.00. Stop loss – 300.00. Short positions may be opened after the price consolidates below the level of 297.00 with the targets at 280.00–275.00. Stop loss – 307.00. Implementation period: 3 days.
Like a lot of the market today, Adobe stock will most likely rise or fall on the FOMC meeting. The market today is focused on the last US Federal Reserve meeting this year. In the evening, the FOMC decision on the interest rate will be announced and a press conference with the head of the regulator Jerome Powell will be held. Officials are expected to leave the rate unchanged at 1.75%. Earlier, FOMC members said that the cuts in rates already undertaken this year were enough to support the prospects for moderate economic growth, a strong labor market and maintaining inflation near the target level of 2.0%. According to a CNBC poll, most analysts believe that the regulator will not leave the interest rate unchanged until next summer. Investors receive conflicting signals from trade negotiations between the United States and China. So, yesterday, the Wall Street Journal reported that the US administration plans to postpone the introduction of new tariffs on Chinese exports, scheduled for December 15. However, later economic adviser Larry Kudlow said that the possibility of imposing duties is still being considered.
Adobe Stock Recommendations
Dec-11-19 Reiterated BMO Capital Markets Outperform $300 → $350
Nov-13-19 Resumed Piper Jaffray Overweight $339
Oct-21-19 Reiterated BMO Capital Markets Outperform $310 → $300
Oct-16-19 Downgrade Citigroup Buy → Neutral $322 → $313
Oct-15-19 Initiated Cleveland Research Neutral $283
Sep-18-19 Reiterated Griffin Securities Buy $303 → $317
Sep-18-19 Reiterated BMO Capital Markets Outperform $315 → $310
Sep-13-19 Resumed RBC Capital Mkts Outperform
Jun-19-19 Upgrade Stephens Equal-Weight → Overweight $288 → $327
Jun-19-19 Reiterated BofA/Merrill Buy $312 → $323
Jun-19-19 Reiterated BMO Capital Markets Outperform $300 → $315
Apr-29-19 Upgrade Morgan Stanley Equal-Weight → Overweight $282 → $340
Mar-15-19 Reiterated Canaccord Genuity Buy $290 → $300
Mar-15-19 Downgrade KeyBanc Capital Markets Overweight → Sector Weight
Feb-15-19 Downgrade Cowen Outperform → Market Perform $280
Jan-17-19 Initiated Stephens Equal-Weight
Jan-09-19 Initiated Atlantic Equities Neutral $250
Jan-07-19 Upgrade Pivotal Research Group Hold → Buy $262
Dec-14-18 Reiterated Pivotal Research Group Hold $254 → $252
Dec-14-18 Reiterated BMO Capital Markets Outperform $295 → $300