Is Adobe Stock a Buy Now?
Adobe (NASDAQ: ADBE) is a software company that many up-and-coming SaaS (software-as-a-service) companies aspire to be like. However, because of increased scrutiny thanks to a significant acquisition, the stock is down 14% since its acquisition announcement.
However, with the sell-off, Adobe's stock is cheaper than ever since switching to an SaaS model nearly a decade ago. Is this pessimism warranted or is it just investor overreaction?
Alongside its third-quarter (ending Sept. 2) results, Adobe revealed its intent to acquire Figma, a collaborative design tool. What concerned investors wasn't the acquisition but the price Adobe plans to pay: $20 billion. For that chunk of change, Adobe will get a company that produces $400 million in annual recurring revenue and is free-cash-flow positive.
Source Fool.com
