Adobe Stock at Two-Year Lows After Earnings, Acquisition News

The cloud concern inked a multi-billion dollar acquisition

Deputy Editor
Sep 15, 2022 at 10:20 AM
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Adobe Systems Incorporated (NASDAQ:ADBE) is plummeting today, last seen down 13.2% to trade at $322.57. The software company reported adjusted third-quarter earnings of $3.40 per share on revenue of $4.43 billion, the former of which topped expectations and the latter matching estimates. Overshadowing the earnings beat is a lower-than-expected current-quarter revenue outlook, as well as Adobe's announcement of a deal to acquire design software firm Figma for about $20 billion in cash and stock.

Options activity is ramping up in response to all the news. Within the first hour of trading, 16,000 calls and 12,000 puts have been traded, with total volume running at 12 times what's typically seen at this point. The September 375 call is the most popular, while new positions are being opened at the 300 put from the same standard series set to expire tomorrow.

It's worth noting the equity's Schaeffer's Volatility Scorecard (SVS) sits at 96 out of 100, indicating the stock has frequently exceeded option traders' volatility expectations during the past year.

On the charts, Adobe stock today gapped down to its lowest level since May 2020. ADBE is 51% lower year-over-year, carving out a channel of lower lows since a Nov. 22 record peak of $699.54. 

 

 

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