Adobe Systems Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Adobe Systems (NASDAQ:ADBE) will unveil its latest earnings on Thursday, December 13, 2012. Adobe Systems offers a line of creative, business, web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

Adobe Systems Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 46 cents per share, a decline of 11.5% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 56 cents. Between one and three months ago, the average estimate moved down. It has risen from 45 cents during the last month. For the year, analysts are projecting profit of $1.91 per share, a rise of 6.1% from last year.

Past Earnings Performance: For the past three quarters, the company’s quarterly results have come in below analyst’s expectations. Last quarter, the company reported net income of 44 cents per share versus a mean estimate of profit of 47 cents per share.

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Stock Price Performance: Between October 11, 2012 and December 7, 2012, the stock price had risen $3.70 (11.6%), from $31.78 to $35.48. The stock price saw one of its best stretches over the last year between November 27, 2012 and December 5, 2012, when shares rose for seven straight days, increasing 6.7% (+$2.22) over that span. It saw one of its worst periods between November 6, 2012 and November 14, 2012 when shares fell for seven straight days, dropping 6.3% (-$2.16) over that span.

Wall St. Revenue Expectations: Analysts predict a decline of 4.3% in revenue from the year-earlier quarter to $1.1 billion.

A Look Back: In the third quarter, profit rose 3.2% to $201.4 million (40 cents a share) from $195.1 million (39 cents a share) the year earlier, but fell short analyst expectations. Revenue rose 6.6% to $1.08 billion from $1.01 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 14.3% in the fourth quarter of the last fiscal year, 1.7% in the first quarter and 9.9% in the second quarter before increasing again in the third quarter.

After some good news last quarter, the company is trying to build on the result with this upcoming earnings announcement. Net income fell in the fourth quarter of the last fiscal year, the first quarter and the second quarter before snapping that run with a profit increase in the third quarter.

Analyst Ratings: With 10 analysts rating the stock as a buy, two rating it as a sell and 11 rating it as a hold, there are indications of a bullish outlook.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.43 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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