Analysts have designated Adobe Inc. (NASDAQ:ADBE) as one of the top AI stocks to consider. Piper Sandler recently reaffirmed its Overweight rating and set a price target of $470 for the company following its fiscal year 2025 results, which featured a revenue beat of $94 million—significantly higher than the past four-quarter average of $77 million.
In addition to this impressive performance, Adobe has forecasted its fiscal first-quarter revenue to fall between $6.25 billion and $6.3 billion, surpassing Wall Street’s expectations of $6.23 billion. For the full fiscal year, the company estimates revenues will range from $25.9 billion to $26.1 billion, also edging past the analyst projection of $25.89 billion.
Adobe’s ability to generate strong cash flow and its aggressive share repurchase strategy have contributed to its favorable financial standing. The company has set an ambitious net new Digital Media Annual Recurring Revenue (ARR) target of $2.6 billion for fiscal year 2026.
Piper Sandler also noted the impressive growth of Adobe’s AI operations, reporting a threefold increase in AI credit consumption quarter-over-quarter. Furthermore, the company’s annual recurring revenue influenced by AI has exceeded $8 billion.
As a leading software provider, Adobe Inc. specializes in tools for creating, publishing, and promoting digital content. Its flagship products include Photoshop, Illustrator, Acrobat, and Premiere Pro, which are commonly bundled within the Adobe Creative Cloud subscription service.
While Adobe is recognized for its potential as an investment, some analysts suggest that other AI stocks could present better upside, with lower associated risks. For investors looking for undervalued AI stocks, particularly those benefitting from favorable market conditions and trends, additional resources on optimal choices in this sector are available.
