Daniel Durn, CFO of Adobe (ADBE), recently bought 1,300 shares. The buy increased his stake by 13%, and came to a total cost of $204,750.
This is the second insider buy at Adobe this year, following a director pickup of 2,250 shares for just under $999,000 back in January. Going further back insiders, including Durn, were more likely to be sellers, although Adobe stock traded significantly higher at the time of those sales.
Overall, Adobe insiders own 0.2% of shares.
Adobe shares are down 22% over the past year, and off nearly one-third from their all-time high. That’s in spite of a 10% increase in revenues, a hefty 192% jump in earnings growth, and a fat 30% profit margin.
Adobe continues to perform well by adding new AI tools for users and subscribers, but the market remains skeptical. Shares now trade at 20 times forward earnings, a reasonable valuation in today’s markets.
Action to take: Adobe recently hit a 52-week low and has started to trend higher, but that trend may not hold. It may be best to buy a starting position now, and use any further weakness to add to the position.
Currently, Adobe does not pay a dividend.
For traders, the June $440 calls, last trading for about $11.30, could see mid-double-digit returns on any short-term jump higher. Traders will want to look to take quick profits.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.