Insider Trading Report: Adobe (ADBE)

Daniel Durn, CFO and EVP at Adobe (ADBE), recently picked up 3,250 shares. The buy increased his holdings by over 57 percent, and came to a total cost of just over $936,000.

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  • This is the first insider buy at the company since a director picked up 973 shares back in January. Otherwise, company insiders have been sellers of shares, including both executives and directors. That’s fairly typical for a large-cap tech company, making the rare insider buys more interesting.

    Overall, company insiders own 0.4 percent of shares.

    The software company is down 53 percent over the past year, with a large drop in the past week as the company announced the acquisition of a major competitor.

    While shares have been hit hard, earnings are down just 6 percent in the past year, and revenues are up nearly 13 percent.

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  • Action to take: While there will be some overhang on shares amid a big acquisition, the drop in price has taken the stock from 58 times earnings last year to under 18 times forward earnings today. Shares are worth accumulating as they’ll likely recover in time during the next market rally, but investors likely don’t need to be in a rush.

    For traders, the January $310 calls, last going for about $15.50, offer mid-double-digit returns in the coming months. Traders can likely buy the option on a down day and flip them amid the current market volatility for a faster return.

     

    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 of the companies mentioned in this article.

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