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• Morgan Stanley raises its price target on Adobe Inc to a Street-high.
• Analyst Keith Weiss expects AI to remain a material tailwind for ADBE.
• Adobe stock is already up more than 50% versus the start of the year.

Adobe Inc (Nasdaq: ADBE) has already rallied more than 50% since the start of this year but a Morgan Stanley analyst says it’s not done pleasing its shareholders just yet.
 

Adobe stock should be worth $660

On Monday, Keith Weiss upgraded the computer software company to “overweight” and raised his price objective on the tech stock to $660 – up another 25% from its previous close.

The analyst is convinced that artificial intelligence will remain a material tailwind for Adobe stock moving forward.

 

Generative AI products like Firefly coupled with enhancements to flagship applications renew our confidence in a robust product innovation engine at Adobe.

The Nasdaq-listed firm is expected to earn $3.17 a share in its current financial quarter versus $2.63 per share a year ago.
 

Adobe recently raised its full-year guidance

Keith Weiss expects Adobe Creative Cloud to boost the compound annual growth rate (CAGR) of the company’s per-share earnings to 17% between 2022 and 2025. His research note reads:

 

Supported by one of the strongest franchises in software, Adobe’s Creative Cloud is well positioned to integrate Gen AI functionality into existing workflows of a broad base of subscribers.

The Morgan Stanley analyst raised his price target on Adobe stock to a Street-high today also because the management recently raised guidance for the full year (read more). They now see $15.70 of adjusted per-share earnings in fiscal 2023 on up to $19.35 billion in revenue.

Adobe is currently facing an in-depth investigation in the European Union over its $20 billion buyout of Figma Inc.

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