What Percentage of Adobe’s Stock Price Can Be Attributed To Growth?
In this analysis, we quantify the percentage of Adobe’s (NASDAQ: ADBE) stock that can be attributed to growth.
We know, that a stock’s valuation can be highly influenced by future expectations of earnings growth. However, in theory, if a company sees no growth opportunities it should distribute all its earnings as dividends to its shareholders. Assuming that a company pays all earnings as dividends for the rest of the period, we can calculate Present Value of Growth Opportunity (PVGO) of a stock from the formula given below:
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Have more questions about Adobe? See the links below.
- What’s Adobe’s Revenue And Earnings Breakdown?
- What’s Adobe’s Fundamental Value Based On 2015 Results?
- By What Percentage Did Adobe’s Revenue And EBITDA Increase In The Last Five Years?
- How Has Adobe’s Revenue Composition Changed Over The Last 5 Years?
Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Adobe