Adobe Systems (ADBE) & Rosetta Stone (RST) Critical Analysis
Adobe Systems (NASDAQ: ADBE) and Rosetta Stone (NYSE:RST) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, valuation, risk, earnings, institutional ownership and dividends.
Volatility and Risk
Adobe Systems has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500. Comparatively, Rosetta Stone has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500.
Insider & Institutional Ownership
87.2% of Adobe Systems shares are held by institutional investors. Comparatively, 72.0% of Rosetta Stone shares are held by institutional investors. 0.4% of Adobe Systems shares are held by company insiders. Comparatively, 14.5% of Rosetta Stone shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This is a breakdown of recent ratings and price targets for Adobe Systems and Rosetta Stone, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Adobe Systems presently has a consensus price target of $172.13, indicating a potential downside of 5.58%. Rosetta Stone has a consensus price target of $15.00, indicating a potential upside of 35.87%. Given Rosetta Stone’s stronger consensus rating and higher probable upside, analysts plainly believe Rosetta Stone is more favorable than Adobe Systems.
Valuation and Earnings
This table compares Adobe Systems and Rosetta Stone’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Adobe Systems||$5.85 billion||15.35||$1.17 billion||$3.19||57.15|
|Rosetta Stone||$194.09 million||1.27||-$27.55 million||($0.42)||-26.29|
Adobe Systems has higher revenue and earnings than Rosetta Stone. Rosetta Stone is trading at a lower price-to-earnings ratio than Adobe Systems, indicating that it is currently the more affordable of the two stocks.
This table compares Adobe Systems and Rosetta Stone’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Adobe Systems beats Rosetta Stone on 10 of the 13 factors compared between the two stocks.
Adobe Systems Company Profile
Adobe Systems Incorporated is a software company. The Company offers products and services used by professionals, marketers, knowledge workers, application developers, enterprises and consumers for creating, managing, delivering, measuring, optimizing and engaging with compelling content and experiences. It operates through three segments: Digital Media, Digital Marketing, and Print and Publishing. Its Digital Media segment provides tools and solutions that enable individuals, small and medium businesses and enterprises to create, publish, promote and monetize their digital content. Its Digital Marketing segment provides solutions and services for how digital advertising and marketing are created, managed, executed, measured and optimized. Its Print and Publishing segment addresses market opportunities ranging from the diverse authoring and publishing needs of technical and business publishing to its legacy type and original equipment manufacturer (OEM) printing businesses.
Rosetta Stone Company Profile
Rosetta Stone Inc. (Rosetta Stone) offers personalized language and reading programs. The Company’s solutions are used by schools, businesses, government organizations and individuals around the world. Its segments include Enterprise & Education, which derives revenues from sales to educational institutions, corporations and government agencies worldwide, and Consumer, which derives revenue from sales to individuals and retail partners. Its cloud-based programs allow users to learn online or on-the-go via tablet or smartphone, whether in a classroom, corporate setting, or personal learning environment. Its Fit Brains business offers personalized brain training programs. The Company offers courses in over 30 languages across formats, including Web-based software subscriptions, digital downloads, mobile applications, and perpetual compact disc packages. It also offers a portfolio of technology-based learning products for personal use to the global consumer.
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