Adobe Downgraded to Sell on Growth Concerns. ‘Meaningful Cracks Now Starting to Show.

Impact · against what's priced in

The Wells Fargo downgrade acts as a catalyst for a bearish re-rating of Adobe, as it provides evidence for the structural margin erosion and pricing power loss the market had previously declined to price in. While growth deceleration was already assumed, the specific mention of losing pricing power challenges the assumption of sustained 41% FCF margins.

ADBE−0.50

Challenges what's priced in

The price assumes