Adobe Stock Lost 23% In One Week, What’s Next?
Adobe’s stock (NASDAQ: ADBE) dropped 22.9% in the last week, significantly underperforming the S&P 500 (down 4%). Further, the same trend was observed over the last ten days (-24.6% vs -4.8%) and one month (-30.4% vs -8.4%).
Although the tech stocks have struggled in 2022 due to tough macroeconomic conditions, the recent stock drop was driven by the announcement of the Adobe-Figma deal on September 15th. Notably, the company has entered into a definitive merger agreement to acquire Figma (a leading web-first collaborative design platform) for roughly $20 billion in cash and stock. The acquisition price, which is more than 50 times the annual revenues of Figma, has made investors cautious about Adobe stock. Markedly, the stock decreased 17% on the same day this deal was announced by the firm.
Now, is ADBE stock set to drop further, or could we expect some recovery? We believe that there is a more than 90% chance of a rise in ADBE stock over the next month (21 trading days) based on our machine-learning analysis of trends in the stock price over the last ten years. See our analysis on Adobe’s Stock Chance of Rise.
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Twenty-One Day: ADBE -30.4%, vs. S&P500 -8.4%; Underperformed market
- Adobe stock lost 30.4% over the last twenty-one trading days (one month), compared to a broader market (S&P500) decrease of 8.4%
- A change of -30.4% or more over twenty-one trading days has occurred zero times in the last ten years.
Ten Day: ADBE -24.6%, vs. S&P500 -4.8%; Underperformed market
- Adobe stock decreased 24.6% over the last ten trading days (two weeks), compared to broader market (S&P500) loss of 4.8%
- A change of -24.6% or more over ten trading days has occurred zero times in the last ten years.
Five Day: ADBE -22.9%, vs. S&P500 -4%; Underperformed market
- Adobe stock lost 22.9% over a five-day trading period ending 09/21/2022, compared to the broader market (S&P500) decrease of 4%
- A change of -22.9% or more over five trading days (one week) has occurred zero times in the last ten years
Alternate Scenario – Twenty-One Day: ADBE -20%
(less than 1% likelihood event; more than 90% probability of rise over next 21 days)
- A change of -20% or more over twenty-one trading days is a less than 1% likelihood event, which has occurred six times in the last ten years
- Of these six instances, the stock has seen a positive movement over the next twenty-one trading days on all the six occasions
- This points to a more than 90% probability for the stock rising over the next twenty-one trading days
What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.
| Returns | Sep 2022 MTD [1] |
2022 YTD [1] |
2017-22 Total [2] |
| ADBE Return | -23% | -50% | 178% |
| S&P 500 Return | -4% | -20% | 69% |
| Trefis Multi-Strategy Portfolio | -6% | -21% | 213% |
[1] Month-to-date and year-to-date as of 9/22/2022
[2] Cumulative total returns since the end of 2016
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