Morgan Stanley Comments On Solid Q1 Results For Adobe Systems

In a report published by Morgan Stanley, Adobe Systems ADBE Q1 results look solid, and guidance is the key question.

Morgan Stanley said that it remains bullish on the long term prospects for ADBE, and anticipates solid Q1 results aided by 1 point of currency benefit YoY. “Our checks suggest CS5 demand is tracking at or above plan for Q1, licensing remains strong and ADBE is becoming a more strategic content authoring platform. Additionally, Enterprise & Acrobat likely had strong results in Q1. CS5 is likely still lagging CS3, however, while CS will likely grow only mid single digits in FY11. And, while we are encouraged about areas like CEM and think subs. models will be additive, we'd like to see more scale in the high growth businesses and new models, and with <10% upside to our base case, we prefer other names.”

Adobe Systems closed yesterday at $32.09.