Model output: ADOBE INC. (ADBE), price $237.69 as of 2026-10-02
Financial snapshot (SEC XBRL; FY = fiscal year, TTM through 2026-08-28)
| Metric | FY2022 | FY2023 | FY2024 | FY2025 | TTM |
|---|---|---|---|---|---|
| Revenue | $17.6B | $19.4B | $21.5B | $23.8B | $26.0B |
| Gross profit | $15.4B | $17.1B | $19.1B | $21.2B | $23.2B |
| Operating income | $6.1B | $6.7B | $6.7B | $8.7B | $9.3B |
| Net income | $4.8B | $5.4B | $5.6B | $7.1B | $7.3B |
| Operating cash flow | $7.8B | $7.3B | $8.1B | $10.0B | $10.8B |
| CapEx | $0.4B | $0.4B | $0.2B | $0.2B | $0.2B |
| Free cash flow | $7.4B | $6.9B | $7.9B | $9.9B | $10.6B |
| Diluted EPS | $10.10 | $11.82 | $12.36 | $16.70 | $17.91 |
Balance sheet (latest): cash $4.4B, debt $6.4B, equity $11.8B; diluted shares 0.403B; market cap $95.8B; EV $97.8B.
WACC: Rf 5.3% (10y UST, ^TNX) + β 1.26 (raw 5y monthly vs S&P 500 1.39; Blume-adjusted) × ERP 4.5% = Ke 10.9%. Kd 5.3% pre-tax × (1 − 21.5%) = 4.1%. Weights E 93.8% / D 6.2% → WACC 10.5%.
DCF (10-yr, mid-year convention) — $B
| Yr | Revenue | Growth | EBIT margin | NOPAT | D&A | CapEx | ΔNWC | FCF | PV |
|---|---|---|---|---|---|---|---|---|---|
| 1 | 28.6 | 10.0% | 36.0% | 8.1 | 0.8 | 0.3 | 0.0 | 8.6 | 8.2 |
| 2 | 31.1 | 9.0% | 35.7% | 8.7 | 0.9 | 0.3 | 0.0 | 9.3 | 8.0 |
| 3 | 33.8 | 8.5% | 35.3% | 9.4 | 1.0 | 0.4 | 0.0 | 10.0 | 7.8 |
| 4 | 36.5 | 8.0% | 35.0% | 10.0 | 1.1 | 0.4 | 0.0 | 10.7 | 7.5 |
| 5 | 39.0 | 7.0% | 34.7% | 10.6 | 1.2 | 0.5 | 0.0 | 11.3 | 7.2 |
| 6 | 41.6 | 6.5% | 34.3% | 11.2 | 1.2 | 0.5 | 0.0 | 11.9 | 6.9 |
| 7 | 44.1 | 6.0% | 34.0% | 11.8 | 1.3 | 0.6 | 0.0 | 12.5 | 6.5 |
| 8 | 46.3 | 5.0% | 33.7% | 12.2 | 1.4 | 0.6 | 0.0 | 13.0 | 6.1 |
| 9 | 48.4 | 4.5% | 33.3% | 12.7 | 1.4 | 0.7 | 0.0 | 13.4 | 5.7 |
| 10 | 50.3 | 4.0% | 33.0% | 13.0 | 1.5 | 0.8 | 0.0 | 13.8 | 5.3 |
PV of FCF $69.3B. Terminal value — perpetuity (g = 3.0%): TV $188.5B, PV $69.4B → EV $138.6B → $339.12/share (implies 10.4x terminal EBITDA). Exit multiple (14.0x EBITDA): TV $253.1B, PV $93.1B → EV $162.4B → $398.11/share (implies g = 4.8%). Net debt $2.0B.
Sensitivity, perpetuity method ($/share): rows WACC, columns terminal g
| WACC \ g | 2.0% | 2.5% | 3.0% | 3.5% | 4.0% |
|---|---|---|---|---|---|
| 9.5% | $361 | $375 | $392 | $411 | $434 |
| 10.0% | $338 | $350 | $364 | $379 | $398 |
| 10.5% | $317 | $328 | $339 | $352 | $367 |
| 11.0% | $299 | $308 | $318 | $329 | $341 |
| 11.5% | $283 | $291 | $299 | $308 | $319 |
Comparable companies (TTM; forward P/E uses next-FY consensus EPS supplied in config)
| Company | Price | Mkt cap | P/E TTM | P/E fwd | EV/EBITDA | P/S | P/FCF |
|---|---|---|---|---|---|---|---|
| ADBE | $237.69 | $95.8B | 13.3x | 9.0x | 9.7x | 3.7x | 9.0x |
| INTU | $281.08 | $77.9B | 17.1x | n/a | 13.3x | 3.6x | 9.0x |
| CRM | $234.69 | $198.3B | 21.5x | n/a | 22.4x | 4.5x | 13.1x |
| NOW | $134.38 | $139.4B | 84.0x | n/a | 51.7x | 9.5x | 30.4x |
| ADSK | $212.00 | $44.9B | 27.5x | n/a | 19.3x | 5.8x | 15.8x |
| PTC | $144.03 | $17.0B | 14.0x | n/a | 14.8x | 5.7x | 18.1x |
| WDAY | $186.14 | $46.6B | 37.9x | n/a | 37.3x | 4.6x | 16.4x |
| Peer median | 24.5x | n/a | 20.9x | 5.2x | 16.1x | ||
| Peer mean | 33.6x | n/a | 26.5x | 5.6x | 17.1x | ||
| Peer low | 14.0x | n/a | 13.3x | 3.6x | 9.0x | ||
| Peer high | 84.0x | n/a | 51.7x | 9.5x | 30.4x |
Implied value per share from peer multiples:
| Multiple | Low | Median | Mean | High |
|---|---|---|---|---|
| P/E TTM | $250.20 | $438.37 | $602.66 | $1,504.22 |
| EV/EBITDA | $326.68 | $515.14 | $654.80 | $1,283.74 |
| P/S | $233.99 | $333.01 | $362.11 | $609.84 |
| P/FCF | $236.28 | $423.38 | $450.68 | $800.05 |
Dividends: no common dividend; DDM not applicable.
Rule #1 Big Five (10y / 5y / 1y): ROIC 24.9% / 29.8% / 39.9%; Sales 17.4% / 13.1% / 10.5%; EPS 29.7% / 9.0% / 35.1%; BVPS 7.0% / -0.1% / -13.2%; OCF 21.2% / 11.9% / 24.5%. Tests passed 11/15. LT debt / FCF = 0.63 yrs.
Sticker Price: EPS $17.91 × (1 + 10.0%)^10 = $46.45 × future P/E 20.0 (min of 2×g = 20.0 and 10y median P/E 45.28; avg 43.82) = $929.08 ÷ 1.15^10 = $229.65; MOS (50%) $114.83. Payback-Time (8y) price $330.71; Ten Cap price $262.89. Data-driven windage growth was 15.0%.