Adobe Inc. ( ADBE ) is still feeling the investor burn despite a slight rebound from its 52-week lows in the low $260/share range. The declines have come in the wake of a reckoningAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no bu ...

The severity of the pullback in software stocks in recent days, driven by fears of advances in artificial intelligence disrupting the industry, has created opportunities for investors to position for ... ...

Core Insights - The S&P 500 has increased by 68% since the launch of OpenAI's ChatGPT in November 2022, primarily driven by gains in big tech stocks, while companies like McDonald's and Starbucks have also benefited from AI-driven productivity expectations [1] - Adobe has faced significant challenges, with its shares down 21% due to fears that AI content-creation technologies may render its services obsolete [2] - Despite the negative sentiment, Adobe reported record revenue of $19.41 billion for the fiscal year following ChatGPT's debut, with a 17% year-over-year earnings growth [5] Financial Performance - Adobe's revenue and net income have shown consistent growth over the past few fiscal years, with revenue increasing from $17.61 billion in 2022 to $23.77 billion in 2025, representing an 11% year-over-year growth in 2025 [6][7] - Net income rose from $4.76 billion in 2022 to $7.13 billion in 2025, indicating strong financial health despite market challenges [6][7] - Earnings per share (EPS) increased from $10.10 in 2022 to $16.70 in 2025, reflecting the company's ability to enhance shareholder value [7] Market Sentiment - There is a rising short interest in Adobe's stock, reaching an eight-year high, indicating growing pessimism among investors [4] - The media has raised concerns about Adobe's future, with some questioning whether it is a "falling knife" [3] - Despite bearish sentiment, there are arguments suggesting that the current market outlook may overlook Adobe's strong fundamentals and growth potential [4]

David, I I was saying earlier to our Brian Sazi, here we are. The S&P 500 is near a record, right. We've seen stocks sort of rise here.It doesn't feel like it though, does it. I don't know. What do you like the sentiment here.Just like we were talking a lot about the the vibe session or whatever that people didn't feel good even if the economic numbers looked good. Right now, it feels like we're in a little bit of a similar situation with the market. What do you think.Yeah, I think there there's a lot of mo ...

J.P. Morgan says fears of an AI-driven software wipeout are overblown and highlights 19 stocks—from Microsoft to CrowdStrike—it believes are positioned to rebound. ...

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Market Sentiment - The CNN Money Fear and Greed index improved, moving to the "Neutral" zone with a current reading of 48.3, up from 43.9 [3] - This index measures market sentiment, indicating that higher fear pressures stock prices while higher greed has the opposite effect [3] Stock Market Performance - U.S. stocks mostly closed higher, with the Nasdaq Composite increasing by over 200 points during the session [1] - The Dow Jones index reached a record high, closing higher by approximately 20 points at 50,135.87 [2] - The S&P 500 rose by 0.47% to 6,964.82, while the Nasdaq Composite increased by 0.90% to 23,238.67 [2] Sector Performance - Most sectors on the S&P 500 ended positively, with materials, energy, and information technology stocks showing the largest gains [2] - In contrast, consumer staples and health care stocks closed lower, diverging from the overall market trend [2]

Key Takeaways Adobe is among a small group of stocks showing accelerating quarter-over-quarter EPS growth this month.Goldman Sachs meets strict screening criteria, highlighting rising EPS growth rates across recent quarters.ETR made the final cut as earnings acceleration narrowed thousands of stocks down to just 11 candidates.In February, astute investors are likely to prioritize companies that deliver consistent earnings growth as a sign of profitability. Even more impactful, though, is earnings accelerati ...

Core Insights - The market capitalization of SaaS, data, and software investment companies has evaporated by approximately $300 billion due to the release of an AI product, rather than disappointing earnings or macroeconomic shocks [1] - The IGV software index has dropped about 30% from its peak in late September, with significant declines in stock prices for major companies like Salesforce, ServiceNow, Adobe, and Workday, which fell around 7%, and Intuit, which plummeted nearly 11% [2] - The average expected price-to-earnings ratio for software companies has sharply decreased from about 39 times to approximately 21 times in just a few months [2] Group 1: Market Dynamics - The crisis in the SaaS sector has been ongoing for several months, with a recent acceleration in the speed of market reactions [2] - Short sellers have profited over $20 billion by betting against traditional SaaS businesses, indicating a significant loss of confidence in the sector [2] - The core assumption being challenged is the sustainability of traditional SaaS growth models, which have been supported by predictable recurring revenues and high switching costs [3][4] Group 2: AI Impact - AI is fundamentally testing the logic behind traditional SaaS models, as modern AI systems can replace many human workflows across various applications [6] - Investors are increasingly concerned that the growth of many SaaS companies may be rapidly supplanted by lower-cost, AI-driven solutions [8] - The emergence of AI-driven workflows is seen as a significant threat to the high-growth, low-profit SaaS development path, leading to a loss of market trust [7] Group 3: Future Outlook - High-profile figures like Chamath Palihapitiya and Microsoft CEO Satya Nadella have expressed that the SaaS model is becoming obsolete, predicting a shift towards AI-driven platforms [12][9] - Goldman Sachs predicts that by the end of the decade, AI agents will capture a disproportionate share of profits in the software market, with over 60% of software economic benefits potentially realized through agent systems rather than traditional SaaS services [15][18] - The transition from static applications to adaptive systems is expected to weaken the economic benefits of traditional software, although overall market growth is anticipated [18][19] Group 4: Investment Sentiment - The private equity and credit markets are reacting to the changing landscape, with investors recognizing that continued funding for short-term growth may not yield returns [8][20] - The prevailing investment logic in the software industry, based on predictable revenues and low customer churn, is being recalibrated in light of AI advancements [20] - MongoDB's CEO emphasizes that true platforms, rather than mere products, will endure in the evolving software landscape, highlighting the importance of adaptability and speed in technology transitions [21][26]