All right, welcome back. Calls of the day. Uh we go to one of Jim's favorites.It's Adobe. The target trimmed to 430 from 465. Reiterated outperform at Wolf and at Leenthal.Leavingthal. Leavingthal and Leventhal. >> Yeah, I I'm on my Yeah, I know. I'm on my last my last nerve with this stock.I mean, it's >> the company's operational performance has been fine. The stock's performance has been absolutely lousy. I'm giving it one more earnings report.That's it. I mean, look, they keep >> They're going to fix ev ...

Market Overview - The S&P 500 rose 0.4% to close at 6,338.64 points, marking its fifth consecutive record close and the longest winning streak in over a year [1][3][9] - The index has rebounded significantly after nearly entering a bear market in April, recovering from an 18% drop earlier this year [5][9] Earnings and Investor Sentiment - Over one-third of S&P 500 companies have reported Q2 earnings, with 80% surpassing estimates, contributing to the positive market sentiment [6] - The recent rally is supported by trade developments and expectations of a major trade deal between the U.S. and the European Union [6][7] Key Companies with Growth Potential - **Adobe Inc. (ADBE)**: Expected earnings growth rate of 12% for the current year, with a Zacks Rank 2 [10] - **Microsoft Corporation (MSFT)**: Expected earnings growth rate of 13.1% for the current year, also holding a Zacks Rank 2 [12] - **Amazon.com, Inc. (AMZN)**: Expected earnings growth rate of 13.6% for the current year, currently rated Zacks Rank 1 [14] - **Meta Platforms, Inc. (META)**: Expected earnings growth rate of 7.8% for the current year, with a Zacks Rank 1 [16]

Investment Rating - Industry investment rating: Overweight [1] Core Views - OpenAI has announced a major data center agreement with Oracle to develop a 4.5 GW "Stargate" data center, which will significantly enhance AI processing capacity in the U.S. [4][38] - Alibaba has launched its first self-developed AI glasses, integrating various functionalities and aiming to compete in the AI glasses market [4][39] - The report highlights the ongoing advancements in AI models, with OpenAI set to release the new GPT-5 model and Google's Gemini 2.5 Flash-Lite model achieving stable release [38][39] Summary by Sections Weekly Market Review - From July 21 to July 25, 2025, the Shanghai Composite Index rose by 1.67%, the ChiNext Index increased by 2.76%, and the CSI 300 Index saw a 1.69% rise [24][38] - The media index increased by 2.09%, while the Hang Seng Technology Index rose by 1.86% [24] AI Sector - OpenAI's new data center will have a capacity of 4.5 GW, equating to about 25% of the current total capacity of U.S. data centers [4][38] - Alibaba's AI glasses will come in two versions, with the AR-enabled version prioritized for release [4][39] - The Qwen-MT machine translation model from Alibaba supports 92 languages and offers low-cost translation services [5][39] Semiconductor Sector - SK Hynix plans to supply 24Gb GDDR7 chips by the end of the year, enhancing AI GPU capabilities [6][42] - AMD's CEO indicated that chip costs from TSMC's Arizona facility are 5-20% higher than those from Taiwan [6][42] Smart Driving - Shanghai is set to deploy 500 data-collecting ride-hailing vehicles, aiming to gather over 10 million data clips for autonomous driving model evaluation [9][42] E-commerce - AliExpress has become the second-largest e-commerce platform in Saudi Arabia, reflecting the rapid growth of e-commerce in emerging markets [10][42] - JD.com has launched a plan to introduce 1,000 overseas brands over the next three years, targeting significant sales growth [12][42] Local Life Services - Following regulatory discussions, major food delivery platforms may reduce promotional subsidies, potentially improving profit margins [11][42] Film Industry - The national box office revenue for the week of July 14-20, 2025, reached 829 million yuan, marking a 35% increase from the previous week [14][42] Gaming Sector - The launch of the domestic game "Mingmo: Yuanshu Zhi Yu" on multiple platforms indicates ongoing growth in the gaming industry [15][42]

Core Viewpoint - The article highlights three undervalued stocks in the artificial intelligence (AI) sector: Taiwan Semiconductor, Adobe, and Alphabet, suggesting they present good investment opportunities despite market concerns [1]. Group 1: Company Performance and Positioning - Taiwan Semiconductor is the primary chip fabricator for leading tech companies like Nvidia and Apple, positioning it favorably in the AI race [3]. - The company reported a remarkable 44% revenue increase in the second quarter, exceeding expectations, and is projected to grow at nearly a 20% compound annual growth rate over the next five years [4]. - Adobe is recognized for its industry-standard graphics design tools, but faces concerns about being displaced by generative AI technologies [5]. - Despite these concerns, Adobe has invested in generative AI and developed its Firefly product, allowing it to remain competitive and relevant in the graphic design industry [6][9]. - Alphabet, the parent company of Google, faces similar fears regarding generative AI replacing Google Search; however, its entrenched user base and recent AI search features may help maintain its market share [10][11]. Group 2: Valuation and Market Comparison - Alphabet's stock trades at a significant discount compared to the broader market, with the S&P 500 trading at 23.8 times forward earnings, while Alphabet offers a reasonable price for its growth potential [12][14]. - Adobe is also considered cheap, trading at 18 times forward earnings, indicating potential for upside [14]. - Taiwan Semiconductor trades at 25 times forward earnings, which is a slight premium to the market, but its expected growth rate justifies this valuation, making it a bargain buy [16][17].

Core Viewpoint - Adobe's dominance in the design software market is being challenged by Figma, a cloud-based design platform that simplifies design processes and enhances collaboration among users [2][4][20]. Group 1: Adobe's Market Position - Adobe products like Photoshop, Premiere, and InDesign are essential tools for content creators, with over 40% of commercial content creators using Adobe's products [4]. - Adobe reported a revenue of $5.87 billion for Q2 of fiscal year 2025, reflecting an 11% year-over-year growth when adjusted for fixed exchange rates [4]. Group 2: Figma's IPO and Valuation - Figma is set to launch its IPO, planning to issue over 36 million Class A shares with an expected price range of $25 to $28 per share, leading to a valuation of approximately $16 billion (around 114.5 billion RMB) [6]. - The fundraising amount is expected to exceed $1 billion, with potential estimates reaching $1.5 billion (around 107 billion RMB), making it one of the largest IPOs in the U.S. market this year [7]. Group 3: Figma's Investor Backing - Figma has completed eight rounds of public financing since its inception in 2012, attracting top-tier venture capital firms such as Andreessen Horowitz, Sequoia Capital, and General Catalyst [9]. - The latest funding round before the IPO was completed in July 2024, with a valuation of $12.5 billion led by Coatue and General Catalyst [9]. Group 4: Shareholder Dynamics in IPO - In the upcoming IPO, existing shareholders will sell nearly 24.7 million shares, amounting to approximately $690 million (around 5 billion RMB) at the upper end of the price range, indicating a significant exit opportunity for them [11]. - Notable shareholders include Figma's founder Dylan Field, who plans to sell 235,000 shares, potentially cashing out $6.5 million (around 46 million RMB) [12]. Group 5: Figma's Growth and Market Strategy - Figma's growth trajectory has been bolstered by its ability to adapt and innovate, including the development of AI products to stay competitive in the evolving market [16]. - The cancellation of Adobe's acquisition of Figma in December 2023 resulted in a $1 billion (around 7.15 billion RMB) breakup fee paid to Figma, further enhancing its financial position [16]. Group 6: Founder's Background and Vision - Figma was co-founded by Dylan Field, who initially aimed to create an open-source drone operating system but pivoted to develop a browser-based design tool after recognizing market needs [18][20]. - The collaboration with Evan Wallace, who had extensive software engineering experience, led to the creation of a user-friendly design platform that emphasizes accessibility and collaboration [19][20].

Market Overview - The market capitalization of major US stocks shows varied performance, with Oracle at 762.30 billion, Mastercard at 321.36 billion, and Visa at 770.15 billion, reflecting increases of +0.66%, +0.86%, and +0.68% respectively [3] - Exxon Mobil's market cap is 679.53 billion, with a slight decrease of -0.98%, while Johnson & Johnson and Netflix show minor changes of -0.08% and -0.05% respectively [3] - Companies like Wells Fargo and Cisco have market caps of 270.15 billion and 279.59 billion, with respective increases of +0.98% and -0.58% [3] Notable Stock Movements - T-Mobile US Inc experienced a significant increase of +6.20%, reaching a market cap of 272.19 billion [3] - General Electric and Coca-Cola saw market caps of 285.05 billion and 298.76 billion, with increases of +0.37% and +0.91% respectively [3] - Companies like Disney and Goldman Sachs have market caps of 229.06 billion and 221.80 billion, with slight changes of +0.01% and -0.60% [3] Sector Performance - The technology sector shows mixed results, with Intel at 991.05 billion, down -3.28%, while AMD increased by +2.46% to 254.92 billion [5] - The consumer goods sector is represented by companies like Procter & Gamble and Coca-Cola, with market caps of 371.68 billion and 298.76 billion, showing slight increases [3][4] - The energy sector, represented by Exxon Mobil and Chevron, shows varied performance, with Exxon down -0.98% and Chevron up +0.66% [3] Summary of Key Companies - Oracle's market cap stands at 762.30 billion, reflecting a positive trend [3] - Mastercard and Visa show strong performance with market caps of 321.36 billion and 770.15 billion, both increasing [3] - Companies like Pfizer and Comcast have market caps of 1579.81 billion and 1332.00 billion, with Pfizer showing minimal change and Comcast down -3.16% [4][5]

Core Viewpoint - Artificial intelligence (AI) investing remains a dominant theme in the market, with several AI stocks poised for significant growth in the latter half of 2025 [1] Group 1: Nvidia - Nvidia's stock has increased approximately 30% this year, and the market may not have fully accounted for recent developments [4] - The U.S. government revoked Nvidia's export license for H20 chips to China, impacting projected Q2 growth. Without this license, Nvidia expects 50% year-over-year growth, but with projected H20 sales of $8 billion, growth could rise to 77% [5] - Although H20 sales won't impact Q2 results, they could influence Nvidia's Q3 and Q4 guidance, potentially driving shares higher [6] Group 2: Alphabet and Adobe - Alphabet and Adobe are currently undervalued compared to the broader market, trading at significant discounts despite strong historical performance [7] - The S&P 500 is trading at 23.7 times forward earnings, while both companies are cheaper, with the market assuming generative AI will disrupt their businesses [9] - Despite potential long-term disruption, both companies are well-established and have delivered strong results, presenting a buying opportunity for investors [10] - Continued strong performance and positive guidance could lead to significant stock price increases in the latter half of the year [12] Group 3: Amazon - Amazon's investment potential lies primarily in its cloud computing segment, Amazon Web Services (AWS), which is the market leader and is experiencing rapid growth due to AI and cloud migration trends [13] - AWS contributes 63% of Amazon's operating profits while accounting for only 19% of revenue in Q1, with a growth rate of 17% in that quarter [13] - Continued growth in AWS is expected to drive Amazon's profits higher, potentially leading to further stock price increases throughout 2025 [14]

Core Insights - The article discusses the significance of Big Data in business operations, highlighting its role in processing, storing, and analyzing vast amounts of data to enhance decision-making and operational efficiency [1][3][4]. Company Summaries HubSpot Inc. (HUBS) - HubSpot is recognized for its cloud-based customer relationship management platform, experiencing steady adoption from enterprise customers and solid client additions due to pricing optimization [7][10]. - The integration of AI features, such as AI assistance and insights, is enhancing customer value and driving growth [8][9]. - Expected revenue and earnings growth rates for HubSpot are 15.4% and 15%, respectively, for the current year [10]. Dell Technologies Inc. (DELL) - Dell is benefiting from strong demand for AI servers, securing $12.1 billion in AI server orders, which has built a robust backlog [11][12]. - The company is expanding its cloud services and leveraging partnerships with major players like NVIDIA and Google to enhance its offerings [13][14]. - Expected revenue and earnings growth rates for Dell are 8.8% and 16.2%, respectively, for the current year [14]. Adobe Inc. (ADBE) - Adobe has implemented AI applications across its products, including the introduction of generative AI-driven tools like Adobe Firefly [15][17]. - The company is diversifying into digital marketing services through its AI-driven cloud platform, enhancing its data mining capabilities [16]. - Expected revenue and earnings growth rates for Adobe are 9.5% and 11.8%, respectively, for the current year [17]. Microsoft Corp. (MSFT) - Microsoft is capitalizing on AI momentum and expanding its Azure cloud infrastructure, with strong demand for Office 365 driving revenue growth [18][19]. - The company is enhancing its Intelligent Cloud revenues through Azure AI development and strategic execution [19][20]. - Expected revenue and earnings growth rates for Microsoft are 12.4% and 11.8%, respectively, for the current year [20]. Intel Corp. (INTC) - Intel is making strategic decisions to strengthen its position in the AI sector, with new products featuring improved power efficiency for AI workloads [21][22]. - The company is focused on cost-cutting measures and optimizing its portfolio to foster sustainable growth [22][23]. - Expected revenue and earnings growth rates for Intel are -4.3% and over 100%, respectively, for the current year [23].

Core Insights - Adobe shares closed at $365.79, approximately 38% below its 52-week high of $587.75, with a year-to-date appreciation of 17.7%, underperforming the Zacks Computer and Technology sector and the Zacks Computer – Software industry [1][2] Financial Performance - Since the second-quarter fiscal 2025 report on June 12, Adobe shares have dropped 11.5%, reflecting modest revenue growth prospects amid stiff competition in the AI space [2][9] - Fiscal 2025 revenues are projected between $23.5 billion and $23.6 billion, with non-GAAP earnings expected between $20.50 and $20.70 per share [15][16] - Digital Media Annual Recurring Revenue is expected to grow 11% year over year, with segment revenues anticipated between $17.45 billion and $17.50 billion [16] Competitive Landscape - Adobe's AI business is small compared to competitors like Microsoft and Alphabet, which are leveraging AI for significant revenue growth [3] - Adobe faces competition from DocuSign in the document services and e-signature domain [3] AI Portfolio Development - Adobe is expanding its AI portfolio with products like GenStudio and Firefly Services, tracking ahead of its $250 million Annual Recurring Revenue target for fiscal 2025 [4][9] - The company reported a Digital Media ARR of $18.09 billion, up 12% year over year [4] User Engagement and Product Innovation - Adobe's tools, such as Acrobat AI Assistant and Adobe Express, are gaining traction among business professionals and creators, with over 700 million monthly active users [12] - The Firefly App enhances Creative Cloud applications and supports third-party models, which is expected to boost its popularity [13] Strategic Guidance - Adobe's strategy includes leveraging the Adobe Experience Platform to deliver personalized customer experiences, enhancing advertising effectiveness [14] - The Zacks Consensus Estimate for third-quarter fiscal 2025 earnings is pegged at $5.16 per share, indicating a 10.97% growth from the previous year [17] Investment Outlook - Despite a premium valuation and competition, Adobe's focus on monetizing its AI tools presents a positive outlook for investors, supported by a Zacks Rank 2 (Buy) and a Growth Score of B [18]

Industry Overview - The artificial intelligence (AI) infrastructure space is gaining momentum, with previous concerns about DeepSeek being overstated. The global trend towards digitization is creating opportunities in markets such as 5G, blockchain, and AI. Companies are rapidly adopting generative AI, machine learning (ML), blockchain, and data science to secure a competitive edge [1] Company Recommendations - Five AI-focused stocks with favorable Zacks Ranks that have potential for double-digit returns in the short term are HubSpot Inc. (HUBS), Okta Inc. (OKTA), Adobe Inc. (ADBE), NICE Ltd. (NICE), and Teradata Corp. (TDC). Each stock carries either a Zacks Rank 1 (Strong Buy) or 2 (Buy) [2] HubSpot Inc. (HUBS) - HubSpot provides a cloud-based customer relationship management platform and is experiencing steady multi-hub adoption from enterprise customers. Pricing optimization in its starter edition is leading to solid client additions [5][6] - The integration of HubSpot AI features is enhancing customer value, and its seat pricing model reduces barriers for customer engagement. The growing adoption of inbound applications is a positive factor [6] - Expected revenue and earnings growth rates for HubSpot are 15.4% and 15%, respectively, for the current year, with a slight improvement in earnings estimates [7] - The short-term average price target for HUBS indicates a potential increase of 39.7% from the last closing price of $542.41, with a maximum upside of 71.5% [8] Okta Inc. (OKTA) - Okta operates as an identity partner, offering a suite of products for identity management and security. The company leverages AI to enhance security and user experience [10][11] - Expected revenue and earnings growth rates for Okta are 9.4% and 16.7%, respectively, for the current year, with an improvement in earnings estimates [13] - The average short-term price target for OKTA suggests a potential increase of 29.9% from the last closing price of $95.43, with a maximum upside of 55.1% [14] Adobe Inc. (ADBE) - Adobe has integrated AI applications across its flagship products and introduced generative AI-driven tools like Adobe Firefly. The company is diversifying into digital marketing services [15][16] - Expected revenue and earnings growth rates for Adobe are 9.5% and 11.8%, respectively, for the current year, with a recent improvement in earnings estimates [17] - The average short-term price target for ADBE indicates a potential increase of 35.2% from the last closing price of $365.79, with a maximum upside of 65.4% [18] NICE Ltd. (NICE) - NICE is benefiting from the strength of its cloud business and the adoption of AI-powered solutions, enhancing customer experience through its CXone platform [19][20] - Expected revenue and earnings growth rates for NICE are 7% and 11.2%, respectively, for the current year, with an improvement in earnings estimates [21] - The average short-term price target for NICE suggests a potential increase of 33.9% from the last closing price of $153.41, with a maximum upside of 95.6% [22] Teradata Corp. (TDC) - Teradata is experiencing strong cloud annual recurring revenue (ARR) growth, supported by strategic partnerships and demand for its AI solutions [23][24] - Expected revenue and earnings growth rates for Teradata are 2% and 8.3%, respectively, for the next year, with a slight improvement in earnings estimates [24] - The average short-term price target for TDC indicates a potential increase of 19.5% from the last closing price of $21.59, with a maximum upside of 62.1% [25]