Adobe Systems (ADBE) posted a one-two punch of in-line fourth-quarter earnings and strong subscription growth Thursday after the bell. As a result, shares of ADBE opened 10% higher to just under $60 — a new all-time high for Adobe stock.

Even more interesting: Adobe stock has been sizzling even as revenue and earnings have been moving in the opposite direction. Both metrics suffered a year-over-year drop in every quarter this year, yet ADBE stock still is clobbering the broader market with a nearly 50% climb.

What gives?

Well, Adobe Systems is about a year into its migration to cloud-based software — a booming arena featuring big names like Google (GOOG) and Amazon (AMZN). However, that has caused product sales to fall by more than 30% year-over-year.

That migration has meant a shift from a perpetual licensing model to a subscription model, which naturally has affected revenue substantially. ADBE noted in an early press release after the shift began:

“As Adobe customers migrate from a legacy Creative Suite perpetual licensing model to new Creative Cloud subscriptions, revenue is recognized over time as opposed to at the time of purchase.”

What Matters to Adobe Stock Investors

That’s why year-over-year comparisons — which are pretty ugly for anyone who peeks at the Adobe earnings report in a bubble — aren’t a great metric for assessing ADBE right now. Revenue fell by nearly 10% year-over-year, while earnings suffered a nearly 50% plunge from 2012 levels.

But both metrics still managed to top estimates from Adobe stock analysts, pleasing ADBE shareholders despite a weak outlook. Adobe earnings for the first quarter are expected to be between 22 and 28 cents per share on sales of $950 million to $1 billion. Meanwhile, Analysts had predicted earnings of 33 cents per share on revenue of $1.02 billion.

Expect Adobe stock analysts to lower their targets in coming months … or be very disappointed.

Other news from the Adobe earnings report: strong subscription growth. As subscriptions become the core business model, subscription growth is becoming the main metric to watch. In the most recent quarter, subscription-based revenue jumped 85%, and ADBE now boasts more than 1.4 million Creative Cloud subscriptions thanks to the 402,000 added in Q4.

Meanwhile, deferred revenue also grew to a record of nearly $830 million.

How to Play Adobe Stock Now

Still, it’s questionable how long Adobe stock can keep this climb going as long as earnings continue to suffer from the new subscription model. While ADBE stock analysts had earnings of $2.28 per share on tap for fiscal 2015, Adobe says it only expects to make $2 per share.

Factoring in the current price tag of almost $60 per ADBE share, the stock sports a lofty forward P/E of 30, while long-term earnings growth is slated for less than 12% — making Adobe stock look grossly overvalued.

Microsoft (MSFT), for example, has been right behind Adobe stock this year, with 40% gains. But shares of MSFT stock still are trading for just 13 times forward earnings. And even Oracle (ORCL), which has similar growth on tap, is trading for just more than 10 times 2014 earnings.

As a result, Adobe stock investors likely will be less tolerant of another weak outlook when first-quarter numbers are released. So if you’re long ADBE, proceed with caution and maybe begin taking some profits now.

And if you’re watching Adobe stock from the sidelines, stay there. Sure, ADBE has soared so far in 2013, but hindsight is 20/20. With Adobe stock looking expensive at a new all-time high, now definitely isn’t the time to get in.

As of this writing, Alyssa Oursler did not hold a position in any of the aforementioned securities.