NEW YORK, July 7, 2026, 13:06 (EDT)
- Adobe Inc. gained roughly 4.5% in recent intraday trading, topping underperforming big tech names and the S&P 500 proxy.
- Bank of America picked Adobe back up at Underperform, setting a $190 target. That’s under where the stock traded near $228.
- Adobe’s $25 billion buyback plan is about 27% of its current market cap, giving the company a cash cushion as AI sales remain limited.
Adobe Inc. NASDAQ:ADBE climbed Tuesday despite a new bearish call from Bank of America Corp NYSE:BAC. Shares traded at $227.98, up $9.91, or 4.5%, according to the latest finance feed. Invesco QQQ Trust NASDAQ:QQQ dropped 1.4%. SPDR S&P 500 ETF Trust NYSEARCA:SPY was down 0.3%.
| Instrument | Latest price | Day move | Market read |
|---|---|---|---|
| Adobe Inc. NASDAQ:ADBE | $227.98 | +4.5% | Jumped after a new sell rating |
| Invesco QQQ Trust NASDAQ:QQQ | $712.67 | -1.4% | Tech names lagged again |
| SPDR S&P 500 ETF Trust NYSEARCA:SPY | $748.98 | -0.3% | Major index ETF slipped |
| SPDR Dow Jones Industrial Average ETF Trust (NYSEARCA:DIA) | $528.26 | -0.3% | Dow ETF traded down |
What matters more to investors right now is cash coming back. Adobe’s market cap stood at around $91.75 billion, according to the latest data. The company’s $25 billion buyback plan, announced in April and going until April 30, 2030, is about 27% of its market cap.
| Adobe cash-return math | Figure | Why it matters |
|---|---|---|
| Current market value | $91.75 bln | Used to size the buyback |
| Buyback authorization | $25 bln | Roughly 27% of the market cap |
| Q2 share repurchases | 8.5 mln shares | Close to 2% of Google Finance’s 397.5 mln shares out |
| Q2 buyback spend | $2.11 bln | Takes up 98% of Q2 cash from ops |
| Q2 operating cash flow | $2.17 bln | This funds the buyback |
Adobe bought back $2.11 billion of its own stock in the quarter ending May 29, according to company filings. Net cash from operations came in at $2.17 billion. Adobe repurchased about 8.5 million shares during the same period. SEC Google Finance showed 397.5 million shares outstanding.
That’s the setup. Adobe trades at a P/E around 13, still looking like it’s facing AI headwinds. But if earnings stay up, those buybacks could make a real difference.
Bank of America is back on Adobe with an Underperform rating and a $190 price target, analysts led by Tal Liani said. They set that target using 7x estimated 2027 enterprise value to free cash flow, which is below the peer average of about 9.7x, according to Investing.com. The analysts questioned if Adobe can “reaccelerate growth in the age of AI” and said they don’t see “a clear path to near-term reacceleration.” Investing.com
Adobe said AI-first annual recurring revenue more than tripled from a year ago and topped $500 million. Total ARR at the end of the quarter was $27.10 billion. That means AI-first ARR is around 1.8% of total, about in line with what BofA said about the uptake not moving the revenue needle yet.
Adobe CEO Shantanu Narayen said the company posted “record revenue of $6.62 billion in Q2.” Adobe also lifted its fiscal 2026 guidance, now expecting revenue of $26.50 billion to $26.60 billion and non-GAAP EPS between $24.35 and $24.45. SEC
Adobe’s bull argument is still alive. HSBC Holdings plc NYSE:HSBC analyst Stephen Bersey boosted his rating on the stock last week and questioned why Adobe took a hit when “material impact from AI-powered competitors” hasn’t shown up yet, MarketWatch said. Google Finance listed Bersey’s target at $308, about 35% higher than the current price. That page also listed 8 buys, 17 holds, and 3 sells from analysts in the last three months. MarketWatch
Adobe shares changed hands at $227.98, up roughly 17% from BofA’s $190 price target, though still trading 41% lower than the 52-week high of $386.60. The price is about 20% off the stock’s 52-week bottom at $190.12.
Next up, the focus is on Adobe’s Q3 guidance. The company is projecting revenue between $6.67 billion and $6.72 billion, non-GAAP EPS in the range of $6.05 to $6.10, and guides to about a 44% non-GAAP operating margin.
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