Assume 20bn price and assume Adobe uses the 3bn in cash currently on the balance sheet, Adobe will effectively double their capital base (17bn+17bn) to 34bn , while ONLY increasing their revenues 400mm. Return to capital employed goes from wonderful 23% to mediocre 12%. Lots of growth baked into the price, lots of value destroyed in the short term. The stock should get slaughtered. Lets see if they can deliver!
They did not overpay. Our numbers are incredible and we posed an existential threat to them.
What are your returns to capital? Simply net income divided by your debt plus equity? What is your net income to operating cash flow? I can only find 400mm in rev
They could have been even bigger on their own in the future. Why would ceo sell? Did he want to retire early?
You don’t understand Figma then
you always have to wonder if there’s some kind of funny business going on where the board has some backdoor into wealth transfer and the shareholders take a bath
This is defensive acquisition to protect adobes cash cow . I hope they don’t kill it .
Time to clean house at Figma.
I don't know that market at all, but Wall Street clearly agrees with you Adobe is getting hammered.
Adobe underpaid. The company is getting more and more irrelevant and cannot get 💩 done. Their pricing is excessively inflated and that’s the only reason they managed to stay alive. They literally bought a ticket to survival.
Well said!
Disagree. Their returns to capital have gone from mid-teens to 20-25% over the last 10 years.