Adobe is set to post earnings after the close tomorrow
Computer software name Adobe Inc (NASDAQ: ADBE) is up 2.8% to trade at $408.15 this afternoon, after clocking its fifth consecutive all-time high of $407.06 earlier today. The positive price action comes just one day ahead of its fiscal second-quarter earnings report, which is due out after the close tomorrow, June 11.
Adobe stock's impressive climb from its March lows has been enough to convince most members of the brokerage bunch to take a bullish stance. Of the 20 in coverage, 16 say "buy" or better. There's still room for upgrades and/or price-target hikes though. The remaining four still say "hold," plus, the consensus 12-month price target of $352.52 is an 11.09% discount to current levels.
Similarly, the appetite for calls is unusually high in the options pits. In the last 10 days, 1.58 calls were picked up for every put at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits higher than 84% of all other readings from the past year, implying a healthier-than-usual appetite for long calls of late.
A look back at the past eight quarters shows a mixed post-earnings response for ADBE, where the stock closed lower 50% of the time, the day after reporting. The security has averaged a post-earnings swing of 5.6%, regardless of direction. This time around, the options market is pricing in a slightly larger move of 6.8%.