Adobe (NASDAQ:ADBE) stock is sliding lower on Monday after the software company was hit with a downgrade from Mizuho analyst Gregg Moskowitz.
The Mizuho analyst dropped the firm’s rating for ADBE stock from “buy” to a new “neutral” rating. To put that in perspective, the current analyst consensus for Adobe is “buy.” That comes from 20 “buy” ratings and eight “hold” ratings.
Adding to the bad news for ADBE stock today is a price target cut to go with the downgrade. This has Moskowitz dropping his price target for shares from $480 to $440. That represents roughly 11% upside from the company’s closing price last Friday. For the record, the analyst consensus price target for ADBE is currently $487.58 on MarketBeat.
Why the New Rating and Price Target for ADBE Stock?
Moskowitz explained the reason for the ADBE stock downgrade and price prediction cut in a letter to investors. Here’s a portion of the letter obtained by MarketWatch:
“Our checks this quarter were indicative of a more difficult environment than expected, even allowing for a challenging macro […] While we believe ADBE guided conservatively enough for F3Q, we wouldn’t be surprised by a guide down for F4Q.”
ADBE stock started out with a sharp decline in value this morning. However, shares are starting to recover from that dip. As of Monday morning, shares of Adobe are only down slightly from Friday’s close.
There’s more hot stock market news traders need to know about below!
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
