Adobe(US:ADBE) ZACKS·2024-10-01 13:36Core Viewpoint - The rally in U.S. stocks in 2023 is primarily driven by the technology sector, particularly due to the adoption of generative AI technology [1] Group 1: Technology Giants - Investors should focus on three technology companies: Alphabet Inc. (GOOGL), Amazon.com Inc. (AMZN), and Adobe Inc. (ADBE) for potential returns [1][3] - These companies are expected to have double-digit price upside in the short term and higher earnings per share (EPS) growth rates compared to the S&P 500 index in the long term [2] Group 2: Alphabet Inc. (GOOGL) - GOOGL is leveraging generative AI technology through products like Bard and Gemini, enhancing user experience and search results [6][7] - The expected revenue and earnings growth rates for GOOGL are 14% and 31.6% respectively for the current year, with a long-term earnings growth rate of 17.5% [8] - The average price target for GOOGL represents a potential increase of 23.3% from its last closing price of $165.85, with targets ranging from $170 to $225 [8] Group 3: Amazon.com Inc. (AMZN) - AMZN is successfully integrating AI into its devices, particularly through Alexa, which is driving growth in the smart home market [9] - The expected revenue and earnings growth rates for AMZN are 10.4% and 63.5% respectively for the current year, with a long-term earnings growth rate of 27.4% [10] - The average price target for AMZN indicates a potential increase of 19.9% from its last closing price of $186.33, with targets ranging from $200 to $265 [10] Group 4: Adobe Inc. (ADBE) - ADBE has integrated AI across its products, including Adobe Firefly and AI assistants in Acrobat and Reader, enhancing user productivity [11][12] - The expected revenue and earnings growth rates for ADBE are 10.5% and 13.6% respectively for the current year, with a long-term earnings growth rate of 13.1% [13][14] - The average price target for ADBE suggests a potential increase of 19% from its last closing price of $517.78, with targets ranging from $450 to $703 [14]