Adobe Stock Price: Why People Will Keep Subscribing To Adobe Creative Cloud Software Programs

motek 1The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology  – Senior Analyst at I Know First

Adobe Stock Price:


  • Creative Cloud Software subscriptions remain the biggest and best growth catalyst for Adobe.
  • There are tens of millions of creative professionals who are too dependent on Adobe Photoshop, Illustrator, InDesign, Premiere, After Effects, Dreamweaver, Animate CC.
  • Creative Cloud still has less than 12 million recurring subscribers. It could still grow to 20 million. The growing need for content creators means a career in creative/design is very promising.
  • Essential industry-standard third-party plugins also keeps requiring the latest versions of Adobe software. This compels people to keep subscribing/updating to the latest Adobe Creative Cloud programs.
  • I Know First has positive algorithmic forecasts for ADBE. There’s still probability that Adobe can post a new all-time high before 2017 ends.


Creative/design/content creation software-maker Adobe (ADBE) scaled a new all-time high of $152.59 last August 22. I believe ADBE still has a lot of upside potential. I argued last year that Adobe’s invidious status as a monopoly in print/web/mobile design software makes it a long-term winner. My June 2016 thesis still holds true – ADBE remains a strong buy for investors because nothing can compete/threaten Adobe’s most precious jewel, Creative Cloud.

adobe stock price

(Source: Google)

As long Creative Cloud attracts and retains paying customers of industry-standard software like Photoshop, Illustrator, and After Effects, ADBE is a safe investment. Creative/design professionals are why Creative Cloud is boosting Adobe’s topline/bottomline growth. Revenue from subscriptions is why Adobe posted a record Q2 revenue.

adobe stock price

(Source: Adobe)

Why Adobe Remains The Engine For Multimedia Content Creators

Creative professionals and all content creators are beholden to Adobe software programs like Photoshop, Premiere, Illustrator, and InDesign. Autodesk’s (ADSK), Corel, and Microsoft’s (MSFT) failure to challenge Adobe’s monopoly in creative/design employers will continue to require people to master Creative Cloud software programs before they can get hired.

A career as an Adobe Certified expert in Graphic Design, Motion Graphics, Animation, Web Design, UI/UX design is lucrative. Check any colleges, vocational institutes, and universities. They are 100% teaching Adobe software to train designers. This reality is why Adobe is the engine behind the world’s advertising and content-creation industries.

I estimate that Creative Cloud has almost 11 million subscribers by now. Adobe’s valuation will continue to grow higher if its Creative Cloud gets to 20 million subscribers by 2022. Increasing reach of the internet and faster broadband service require the world to produce more content. My fearless forecast is that the world also needs more and more creative professionals and content producers to produce more content for knowledge, advertising, and entertainment.

Third-Party Software Companies Also Rely And Help Adobe

The invidious industry-standard status of Adobe software has also generated a derivative industry. There are flourishing companies who create plug-ins, actions, and graphics assets to accelerate the workflow of Adobe creative professionals. In exchange for this privilege, they constantly upgrade their plug-ins so that they will only be compatible with the latest versions of Adobe Photoshop or Lightroom.

This is why people who already bought the desktop version of Adobe Photoshop CS6 Creative Suite were forced to sign-up and pay monthly/annual fees to use Adobe Creative Cloud CC software programs. The old CS6 products are incompatible with the latest iterations of pricey but necessary plug-ins like On1,  AlienSkin  Exposure, and Topaz Labs.

Paid-only Lightroom presets that can make a photographer’s workflow faster and his photos better are also usually compatible with the Creative Cloud versions, not the old Lightroom 4. I have acquired Serif’s excellent Affinity Photo and Affinity Designer for $49.99 each. However, I am still subscribing to the $9.99/month Photoshop package because third-party software coded primarily for Photoshop doesn’t work nicely with Affinity Photo.

Time is money. Creative professionals and content creators are now dependent on plug-ins, actions, and presets made for Adobe software because they accelerate workflow. I am dependent on Photoshop plug-ins like AlienSkin Exposure and Google’s (GOOG) Nik Collection to beautify and improve my digital album layout workflow.

adobe stock price

(Source: Google)

Adobe’s industry-standard status means third-party software developers will always prioritize coding for them. In other words, Affinity software products are just going to cater to a few people. Affinity Photo might be faster than Photoshop CC 2017 in some operations. However, Photoshop’s vast library of third-party plug-ins still makes it the go-to choice for deadline-pressured graphic designers like me.

There are people who enriched themselves creating $199 Photoshop Actions bundles because deadline-harassed photographers and lay-out artists (like me) need them to work faster. The faster artists can deliver the albums/designs, the more money they earn.


Adobe Photoshop was and still is my main money maker since 1996. There are tens of millions like me who are too dependent on Adobe software programs. Unless Autodesk or Microsoft can offer me better alternatives, I’ll stick to Adobe software.

Having said that, ADBE is therefore a buy. Adobe has a large base of captured customers. Its subscription-only software products are without any serious competition. Adobe now also helps its customers make money from selling their work through its platform. The Creative Cloud Market is now a great way for Adobe software-using artists to make more money by selling their photos, videos, animations, game assets, UI/UX assets, and vector illustrations.

Adobe, of course, gets a cut from every subscription or purchase made through Adobe Stock or the Creative Cloud Market. Artists who contribute their content on Adobe Stock get 33% to 35% of the sales. This is advantageous to Adobe.

My buy rating for ADBE is in line with the still positive near and long-term algorithmic forecasts from I Know First. I therefore have a 12-month price target for ADBE at $170. Adobe’s monopoly on design/content creation software products means more investors will rally behind it.

adobe stock price

A check on TipRanks account revealed that my $170 PT for ADBE is reasonable. There are Wall Street Analysts who have higher 12-month PT forecasts than mine.

adobe stock price

(Source: TipRanks)

My bullish outlook for Adobe is also congruent with its stock’s very optimistic technical indicators and moving averages trend.

adobe stock price


Past I Know First Forecast Success with ADBE

I Know First has made accurate predictions on ADBE in the past, such as its bullish article published on May 25th, 2017. ADBE was endorsed as a “long-buy” in the article. Reasons for it were that Adobe’s software “Creative Cloud” was expected to keep being the best and most popular software in the industry.  In addition, it explained that Adobe was probable to buy or partner with KingSoft, an up-and-coming software company. At the time when the article was written ADBE shares were trading at 141.12, today it is trading at 152.14 which is a 7.8% return in three months.

(Source: Google Finance: ADBE)

This bullish forecast for ADBE was sent to I Know First subscribers on May 25th, 2017. To subscribe today click here.

I Know First Algorithm Heatmap Explanation

The sign of the signal tells in which direction the asset price is expected to go (positive = to go up = Long, negative = to drop = Short position), the signal strength is related to the magnitude of the expected return and is used for ranking purposes of the investment opportunities.

Predictability is the actual fitness function being optimized every day, and can be simplified explained as the correlation based quality measure of the signal. This is a unique indicator of the I Know First algorithm. This allows users to separate and focus on the most predictable assets according to the algorithm. Ranging between -1 and 1, one should focus on predictability levels significantly above 0 in order to fill confident about/trust the signal.

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