GURUFOCUS.COM » STOCK LIST » Technology » Software » Adobe Inc (NAS:ADBE) » Definitions » PE Ratio

Adobe (ADBE) PE Ratio : 45.45 (As of May. 26, 2024)


View and export this data going back to 1986. Start your Free Trial

What is Adobe PE Ratio?

The PE Ratio, or Price-to-Earnings ratio, or P/E Ratio, is a financial ratio used to compare a company's market price to its Earnings per Share (Diluted). As of today (2024-05-26), Adobe's share price is $475.43. Adobe's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Feb. 2024 was $10.46. Therefore, Adobe's PE Ratio for today is 45.45.

Good Sign:

Adobe Inc stock PE Ratio (=45.45) is close to 1-year low of 41.64

During the past 13 years, Adobe's highest PE Ratio was 161.43. The lowest was 27.14. And the median was 53.14.

Adobe's EPS (Diluted) for the three months ended in Feb. 2024 was $1.36. Its EPS (Diluted) for the trailing twelve months (TTM) ended in Feb. 2024 was $10.46.

As of today (2024-05-26), Adobe's share price is $475.43. Adobe's EPS without NRI for the trailing twelve months (TTM) ended in Feb. 2024 was $15.65. Therefore, Adobe's PE Ratio without NRI ratio for today is 30.38.

During the past 13 years, Adobe's highest PE Ratio without NRI was 109.41. The lowest was 25.46. And the median was 50.52.

Adobe's EPS without NRI for the three months ended in Feb. 2024 was $4.48. Its EPS without NRI for the trailing twelve months (TTM) ended in Feb. 2024 was $15.65.

During the past 12 months, Adobe's average EPS without NRI Growth Rate was 39.20% per year. During the past 3 years, the average EPS without NRI Growth Rate was 14.10% per year. During the past 5 years, the average EPS without NRI Growth Rate was 22.40% per year. During the past 10 years, the average EPS without NRI Growth Rate was 40.50% per year.

During the past 13 years, Adobe's highest 3-Year average EPS without NRI Growth Rate was 88.70% per year. The lowest was -32.00% per year. And the median was 17.20% per year.

Adobe's EPS (Basic) for the three months ended in Feb. 2024 was $1.37. Its EPS (Basic) for the trailing twelve months (TTM) ended in Feb. 2024 was $10.53.

Back to Basics: PE Ratio


Adobe PE Ratio Historical Data

The historical data trend for Adobe's PE Ratio can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Adobe PE Ratio Chart

Adobe Annual Data
Trend Nov14 Nov15 Nov16 Nov17 Nov18 Nov19 Nov20 Nov21 Nov22 Nov23
PE Ratio
Get a 7-Day Free Trial Premium Member Only Premium Member Only 51.59 44.18 66.85 34.15 51.69

Adobe Quarterly Data
May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23 Feb24
PE Ratio Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 31.92 39.87 50.35 51.69 53.56

Competitive Comparison of Adobe's PE Ratio

For the Software - Infrastructure subindustry, Adobe's PE Ratio, along with its competitors' market caps and PE Ratio data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Adobe's PE Ratio Distribution in the Software Industry

For the Software industry and Technology sector, Adobe's PE Ratio distribution charts can be found below:

* The bar in red indicates where Adobe's PE Ratio falls into.



Adobe PE Ratio Calculation

The PE Ratio, or Price-to-Earnings ratio, or P/E Ratio, is a financial ratio used to compare a company's market price to its Earnings per Share (Diluted). It is the most widely used ratio in the valuation of stocks.

Adobe's PE Ratio for today is calculated as

PE Ratio=Share Price/Earnings per Share (Diluted) (TTM)
=475.43/10.460
=45.45

Adobe's Share Price of today is $475.43.
Adobe's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Feb. 2024 adds up the quarterly data reported by the company within the most recent 12 months, which was $10.46.


* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

It can also be calculated from the numbers for the whole company:


There are at least three kinds of PE Ratios used by different investors. They are Trailing Twelve Month PE Ratio, Forward PE Ratio, or PE Ratio without NRI. A new PE Ratio based on inflation-adjusted normalized PE Ratio is called Shiller PE Ratio, after Yale professor Robert Shiller.

In the calculation of PE Ratio, the earnings per share used are the earnings per share over the past 12 months. For Forward PE Ratio, the earnings are the expected earnings for the next twelve months. In the case of PE Ratio without NRI, the reported earnings less the non-recurring items are used.

For Shiller PE Ratio, the earnings of the past 10 years are inflation-adjusted and averaged. Since it looks at the average over the last 10 years, Shiller PE Ratio is also called PE10.


Adobe  (NAS:ADBE) PE Ratio Explanation

The PE Ratio can be viewed as the number of years it takes for the company to earn back the price you pay for the stock. For example, if a company earns $2 a share per year, and the stock is traded at $30, the PE Ratio is 15. Therefore it takes 15 years for the company to earn back the $30 you paid for its stock, assuming the earnings stays constant over the next 15 years.

In real business, earnings never stay constant. If a company can grow its earnings, it takes fewer years for the company to earn back the price you pay for the stock. If a company's earnings decline it takes more years. As a shareholder, you want the company to earn back the price you pay as soon as possible. Therefore, lower P/E stocks are more attractive than higher P/E stocks so long as the PE Ratio is positive. Also for stocks with the same PE Ratio, the one with faster growth business is more attractive.

If a company loses money, the PE Ratio becomes meaningless.

To compare stocks with different growth rates, Peter Lynch invented a ratio called PEG Ratio. PEG Ratio is defined as the PE Ratio divided by the growth ratio. He thinks a company with a PE Ratio equal to its growth rate is fairly valued. Still he said he would rather buy a company growing 20% a year with a PE Ratio of 20, instead of a company growing 10% a year with a PE Ratio of 10.

Because the PE Ratio measures how long it takes to earn back the price you pay, the PE Ratio can be applied to the stocks across different industries. That is why it is the one of the most important and widely used indicators for the valuation of stocks.

Similar to the PE Ratio without NRI or PS Ratio or Price-to-Operating-Cash-Flow or Price-to-Free-Cash-Flow , the PE Ratio measures the valuation based on the earning power of the company. This is where it is different from the PB Ratio , which measures the valuation based on the company's balance sheet.


Be Aware

Investors need to be aware that the PE Ratio can be misleading a lot of times, especially when the underlying business is cyclical and unpredictable. As Peter Lynch pointed out, cyclical businesses have higher profit margins at the peaks of the business cycles. Their earnings are high and PE Ratios are artificially low. It is usually a bad idea to buy a cyclical business when the PE Ratio is low. A better ratio to identify the time to buy a cyclical businesses is the PS Ratio.

PE Ratio can also be affected by non-recurring-items such as the sale of part of businesses. This may increase for the current year or quarter dramatically. But it cannot be repeated over and over. Therefore PE Ratio without NRI is a more accurate indication of valuation than PE Ratio.


Adobe PE Ratio Related Terms

Thank you for viewing the detailed overview of Adobe's PE Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.


Adobe (ADBE) Business Description

Address
345 Park Avenue, San Jose, CA, USA, 95110-2704
Adobe provides content creation, document management, and digital marketing and advertising software and services to creative professionals and marketers for creating, managing, delivering, measuring, optimizing and engaging with compelling content multiple operating systems, devices and media. The company operates with three segments: digital media content creation, digital experience for marketing solutions, and publishing for legacy products (less than 5% of revenue).
Executives
Mark S. Garfield officer: VP, CAO & Corp. Controller 345 PARK AVENUE, SAN JOSE CA 95110-2704
Amy Banse director 345 PARK AVENUE, SAN JOSE CA 95110
David Wadhwani officer: SVP & GM, Digital Media ADOBE INC., 345 PARK AVE, SAN JOSE CA 95110
Shantanu Narayen director, officer: President and CEO 345 PARK AVENUE, SAN JOSE CA 95110
Daniel Durn officer: EVP and CFO C/O APPLIED MATERIALS, INC., 3050 BOWERS AVENUE, P.O. BOX 58039, SANTA CLARA CA 95052-8039
Scott Belsky officer: EVP, Chief Product Officer 345 PARK AVENUE, SAN JOSE CA 95110
Cristiano R Amon director 5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
John E Warnock director, other: Co-Chairman of the Board C/O ADOBE SYSTEMS INC, 345 PARK AVENUE P O BOX 2704, SAN JOSE CA 95110-2704
Dana Rao officer: EVP, Gen. Counsel & Secretary 345 PARK AVE, SAN JOSE CA 95110
Ann Lewnes officer: SVP, Chief Marketing Officer 345 PARK AVENUE, SAN JOSE CA 95110
David A Ricks director LILLY CORPORATE CENTER, INDIANAPOLIS IN 46285
M. Brett Biggs director 702 SW 8TH STREET, BENTONVILLE AR 72716
Laura Desmond director 345 PARK AVENUE, SAN JOSE CA 95110
Spencer Adam Neumann director SIERRA INCOME CORPORATION, 375 PARK AVE., SUITE 3304, NEW YORK NY 10152
Gloria Chen officer: EVP, Strategy & Growth 345 PARK AVENUE, SAN JOSE CA 95110

Adobe (ADBE) Headlines

From GuruFocus

Q4 2023 Adobe Inc Earnings Call Transcript

By GuruFocus Research 01-22-2024

Q4 2022 Adobe Inc Earnings Call Transcript

By GuruFocus Research 01-22-2024

Adobe Inc Investor Day Transcript

By GuruFocus Research 01-22-2024

Q2 2022 Adobe Inc Earnings Call Transcript

By GuruFocus Research 01-22-2024

Adobe Inc at Evercore ISI Bus Tour (Virtual) Transcript

By GuruFocus Research 01-22-2024

Q1 2023 Adobe Inc Earnings Call Transcript

By GuruFocus Research 01-22-2024