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Adobe trades below 10x FY27 P/E despite strong Q1 growth and solid AI adoption, seen as undervalued.

Analyst Insights
12 May 2026
Seeking Alpha
View Source
Bullish
pluang ai news

Adobe's stock is considered undervalued, trading at less than 10 times its projected FY27 price-to-earnings ratio despite strong fundamentals. The company reported a 12% year-over-year revenue increase in Q1, beating expectations, with a 17% rise in monthly active users and strong AI credit usage. Adobe reaffirmed its full-year 2026 guidance, expecting 9% revenue growth, 10% annual recurring revenue growth, and pro forma EPS between $23.30 and $23.50. Despite a selloff driven by sentiment and fears around AI disruption, Adobe's core business metrics and AI monetization remain robust, supporting a "Buy" rating.

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