Up until today, Adobe Inc hasn’t given out any dividends to its shareholders the reason being that the company needs more funds to order to support its core business which is Accelerating Document Productivity.
So Why Should Investors Consider Buying Adobe Stocks?
Adobe is increasing its market demand to a competitive level which indirectly affects its current shareholders as well. The types of returns an investor can expect when buying Adobe shares are:
High expected growth rateCapital gainStrong and Steady financial performance
High Expected Growth Rate
Adobe is one of the leading software firms in cloud documentation with very successful future prospects. Due to its efficient operations, the company has been earning more and more revenue over the past years, as per Adobe’s records it has generated $1.266 million in net income for the first quarter of 2022 which ended on March 4th, 2022. Furthermore, it has also launched new projects such as new updates and upgrades to its after-effects as well as including native M1 support, Team Projects, and Adobe Premiere Pro. Looking at all these factors it can be safe to say that Adobe’s market share will only grow in the coming years.
Capital Gain
Capital Gain is the profit a stakeholder gets when he sells his shares in the stock market, this generally happens when the company in question grows rapidly and attracts the attention of many people, as a result increasing its demand along with its price. So, the person who bought the shares at a lower cost would benefit substantially. Due to the fact of Adobe’s likelihood of gaining dominance over the cloud market many shareholders are holding their stock and even considering buying new shares because its trend is gradually on the rise.
Strong and Steady Financial Performance
Adobe has experienced consistent growth year after year except for a dip in its net income and share prices in October 2021 due to the unfavorable year-over-year comparison because of a one-time benefit from income taxes which positively affected 2020’s fiscal year. Apart from that, the revenue and operating income of the company have increased to 23% and 37% respectively indicating the firm’s ability to efficiently manage its finances.
How to Buy Adobe (ADBE) Stocks?
Since Adobe does not directly sell its shares in the stock market, investors will need to buy their shares through a brokerage firm.
Steps to buying Adobe (ADBE) Stocks
Step 1: Look for a reliable Brokerage firm and create an accountStep 2: Deposit money and buy your stocksStep 3: Frequently monitor your stock’s position
Step 1: Look for A Reliable Brokerage Firm and Create an Account
While there may be many brokerage firms out there, what makes a good brokerage is the number of exchanges they have access to which in the case of Adobe, a brokerage would need to have access to NASDAQ.
Opening a brokerage account is completely an online process and can be done as fast as opening an email account but some firms might take a few days to do some background checks on you.
Step 2: Deposit Money and Buy Your Stocks
Just like creating your brokerage account, depositing money in the account is also a completely online transaction. You can top up your account anytime through your credit/debit card.
Once you have your account set up with some balance in it you can simply buy the stocks by mentioning the number of Adobe shares you want to buy and click on the buy button.
Step 3: Frequently Monitor Your Stock’s Position
After buying the stocks you have to look for an increase in price for capital gain or if you want to keep your stocks as a long-term investment you can regularly check the company’s growth over time.
Conclusion
Adobe may not be giving out any dividends at the moment but it doesn’t mean that it isn’t a good investment opportunity, the company’s high rate of future growth means that its investor’s money is in safe hands. Shareholders can gain profits upon selling their stocks and while the company may not have free cash flows currently, it may still give payouts in the future when it has enough cash flows.
Does Adobe have a Dividend Reinvestment Program (DRIP)?
Answer
No, Adobe does not have this program yet.
What is Adobe’s Fiscal Year?
Answer
Adobe’s fiscal year is a 52/53-week year, ending on the Friday closest to November 30 each year.
