Adobe Inc. (NASDAQ:ADBE)

Over the observed period, the common stock valuation ratios exhibited distinct trends. Generally, a pattern of decline in valuation multiples is apparent from 2021 through 2025, although with some quarterly fluctuations. This suggests a potential shift in investor sentiment or a reassessment of the company’s future growth prospects.

Price to Earnings (P/E) Ratio

The Price to Earnings ratio began at 40.82 and generally decreased over the period, reaching 17.51. Initial increases from March 2021 to June 2021 were followed by a more consistent downward trajectory, particularly noticeable from September 2022 onwards. The most recent value, 17.51, represents a significant decrease from the initial observation, indicating a lower price relative to earnings.

Price to Operating Profit (P/OP) Ratio

Similar to the P/E ratio, the Price to Operating Profit ratio demonstrated a declining trend. Starting at 47.80, it decreased to 14.34 by November 2025. The rate of decline appeared to accelerate in the latter half of the period, mirroring the trend observed in the P/E ratio. This suggests that the market is valuing the company’s operating profitability at a decreasing multiple.

Price to Sales (P/S) Ratio

The Price to Sales ratio also showed a consistent downward trend, moving from 16.61 to 5.25. While exhibiting some quarterly variability, the overall direction was clearly downward. This indicates that investors are willing to pay less for each dollar of revenue generated by the company over time.

Price to Book Value (P/BV) Ratio

The Price to Book Value ratio experienced fluctuations but generally decreased from 16.77 to 10.74. The ratio peaked at 20.14 in June 2021, then declined with some volatility. The final value suggests a lower valuation relative to the company’s net asset value.

The consistent declines across all four valuation ratios suggest a potential convergence towards a lower overall valuation multiple. This could be attributed to various factors, including changing market conditions, increased competition, or adjustments to growth expectations. Further investigation into the underlying drivers of these trends would be necessary to form a more comprehensive assessment.

The price-to-earnings (P/E) ratio exhibited considerable fluctuation throughout the observed period, spanning from March 2021 to November 2025. Initially, the ratio demonstrated an increasing trend, peaking in June 2021 before stabilizing and experiencing moderate volatility through the end of 2021. A significant downward trend commenced in early 2022, continuing through the remainder of the year, and into 2023. The latter half of 2023 and the first half of 2024 showed some recovery, but the ratio then declined sharply again in the latter half of 2024, reaching its lowest point in November 2025.

Initial Period (March 2021 - December 2021)

The P/E ratio began at 40.82 and increased to 49.98 by June 2021, indicating increasing investor optimism or a rising share price relative to earnings. Subsequent fluctuations maintained the ratio within a range of approximately 47 to 49, before decreasing to 48.90 by December 2021. This period suggests a relatively stable, albeit high, valuation.

Downward Trend (January 2022 - November 2024)

From January 2022, the P/E ratio experienced a pronounced decline, falling from 45.03 to a low of 27.18 by September 2022. This suggests a decrease in investor confidence, potentially due to macroeconomic factors or company-specific concerns. The ratio experienced some recovery to 33.15 by December 2022, but continued to decline through the first half of 2023, reaching 44.69. A further decline occurred in the latter half of 2024, culminating in a ratio of 31.98 in November 2024. This extended period of decline indicates a consistent re-evaluation of the company’s stock price relative to its earnings.

Recent Period (November 2024 - November 2025)

The most recent period demonstrates a continued downward trajectory, with the P/E ratio decreasing from 31.98 in November 2024 to 17.51 in November 2025. This represents the most substantial decline observed throughout the entire period, suggesting a significant shift in market perception or a substantial decrease in earnings expectations relative to the share price.

The observed fluctuations in the P/E ratio suggest a dynamic valuation influenced by a combination of market sentiment and earnings performance. The prolonged downward trend, particularly evident in the latter portion of the period, warrants further investigation to determine the underlying drivers and potential implications for future performance.

The Price to Operating Profit (P/OP) ratio exhibited considerable fluctuation over the analyzed period, spanning from March 2021 to November 2025. Initially, the ratio demonstrated an increasing trend, followed by a period of decline, and then a subsequent period of volatility before concluding with a downward trajectory.

Initial Trend (Mar 5, 2021 – Jun 4, 2021)

The P/OP ratio increased from 47.80 to 54.24, indicating that the market was willing to pay a higher premium for each dollar of operating profit during this timeframe. This suggests increasing investor optimism or expectations regarding future profitability.

Subsequent Decline (Jun 4, 2021 – Sep 2, 2022)

From June 2021 through September 2022, the P/OP ratio generally decreased, falling from 54.24 to 21.47. This decline suggests a diminishing investor willingness to pay a premium for operating profit, potentially reflecting concerns about future growth or increased risk perception. The most significant drop occurred between June 2022 and September 2022.

Volatility and Partial Recovery (Sep 2, 2022 – Nov 29, 2024)

Following the decline, the P/OP ratio experienced volatility, fluctuating between 21.47 and 40.52. A partial recovery was observed, peaking at 40.52 in December 2022, but this was followed by further declines and fluctuations. This period indicates uncertainty in the market’s assessment of the company’s value relative to its operating performance.

Final Downward Trend (Nov 29, 2024 – Nov 28, 2025)

The final portion of the period shows a clear downward trend in the P/OP ratio, decreasing from 26.38 to 14.34. This suggests a consistent decrease in the market’s valuation of the company’s operating profit, potentially driven by macroeconomic factors, industry-specific challenges, or company-specific concerns. The ratio reached its lowest point at 14.34 in November 2025.

Throughout the analyzed period, the P/OP ratio demonstrated a sensitivity to market conditions and investor sentiment. The initial increase, followed by a substantial decline and subsequent volatility, highlights the dynamic nature of valuation metrics and the importance of considering broader economic and industry contexts when interpreting these ratios.

The operating profit per share consistently increased throughout the period, however, the P/OP ratio did not follow the same trajectory, indicating that share price did not increase at the same rate as operating profit. This divergence suggests that market perception of the company’s future prospects did not align with its current profitability.

The price-to-sales ratio exhibited a generally declining trend over the observed period, punctuated by periods of fluctuation. Initially, the ratio increased from March 2021 to June 2021, before beginning a sustained decrease through September 2022. A subsequent period of volatility followed, with increases observed through November 2023, before resuming a downward trajectory into May 2025.

Initial Trend (Mar 5, 2021 – Sep 3, 2021)

The price-to-sales ratio began at 16.61 and rose to a peak of 19.39 in June 2021. It then decreased to 18.20 by September 2021, indicating a potential stabilization after initial growth.

Significant Decline (Dec 3, 2021 – Sep 2, 2022)

A substantial decline in the ratio was observed from December 2021 to September 2022, falling from 14.94 to a low of 7.61. This suggests a decreasing valuation relative to sales during this period.

Volatility and Subsequent Decline (Dec 2, 2022 – Nov 28, 2025)

Following the low in September 2022, the ratio experienced fluctuations, peaking at 13.88 in December 2022, before decreasing again. The ratio then showed a moderate increase through November 2023, reaching 13.88. However, a final decline commenced, reaching 5.25 by November 2025. This indicates renewed downward pressure on the valuation relative to sales.

Recent Period (Feb 28, 2025 – Nov 28, 2025)

The most recent measurements show a continued decrease in the price-to-sales ratio, moving from 7.27 in February 2025 to 5.25 in November 2025. This suggests that the market is placing a lower valuation on each dollar of sales compared to earlier periods.

Throughout the period, the share price and sales per share both generally increased, but the price-to-sales ratio decreased overall. This suggests that sales growth did not keep pace with the decline in market valuation, or that investor sentiment shifted regarding the company’s future sales potential.

The price-to-book value (P/BV) ratio for the observed period demonstrates considerable fluctuation. Initially, the ratio exhibited an increasing trend from March 2021 to June 2021, peaking at 20.14, before declining through December 2021 to reach 15.94. A significant downward trend followed into mid-2022, with the ratio falling to a low of 9.10 in September 2022. Subsequently, the ratio experienced a period of recovery, rising to 16.31 by March 2023. The latter half of the observed period shows a more volatile pattern, with peaks and troughs, ultimately concluding at a ratio of 10.74 in November 2025.

Initial Phase (Mar 5, 2021 – Dec 3, 2021)

The P/BV ratio began at 16.77 and initially increased, suggesting a growing investor confidence in the company’s ability to generate value relative to its book value. The subsequent decline towards the end of 2021 could indicate a correction in market expectations or emerging concerns.

Significant Decline (Jun 3, 2022 – Sep 2, 2022)

The most pronounced decrease in the P/BV ratio occurred during this period, falling from 12.33 to 9.10. This substantial drop may be attributed to broader market conditions, company-specific challenges, or a reassessment of the company’s intrinsic value. The ratio reached its lowest point during the observed timeframe.

Recovery and Volatility (Mar 4, 2023 – Nov 28, 2025)

Following the low in September 2022, the P/BV ratio demonstrated a recovery, reaching 16.31 by March 2023. However, the period from March 2023 to November 2025 was characterized by increased volatility, with the ratio fluctuating between approximately 10.74 and 16.31. This suggests a period of uncertainty and shifting investor sentiment. The final value of 10.74 represents a decrease from the peak observed in early 2023.

Book Value per Share (BVPS) Trend

Book value per share generally increased from March 2021 to September 2022, moving from 28.34 to 30.92. After September 2022, BVPS experienced a slight decline, reaching 28.31 in November 2025. This suggests that while the company was initially increasing its net asset value, the rate of growth slowed and eventually reversed.

The interplay between the share price and book value per share is evident in the P/BV ratio’s movements. Periods of increasing share price relative to a stable or slowly increasing book value resulted in higher P/BV ratios, while the opposite scenario led to lower ratios. The observed volatility suggests that market perceptions of the company’s future earnings potential and risk profile were subject to change throughout the period.