RBC Capital analyst Matthew Swanson keeps an Outperform rating and $610 price target on Adobe after its Q3 earnings and guidance. The quarter’s results were “strong”, headlined by Digital Media’s net-new ARR outperformance of 9.5% as well as solid revenue performance flowing through to profitability, though Q3 performance and the management commentary did not mesh well with lowered Q4 guidance, the analyst tells investors in a research note. Given the company’s recent innovation and execution, Adobe’s lowered outlook will likely prove conservative, with an additional potential catalyst from Adobe Max leading RBC to believe that the negative stock weakness after earnings was “an overreaction”, the firm added.
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