Wallstreet is WRONG! I'm Buying $5,000 Worth of Adobe ADBE Stock

Описание: #adobe #duolingo #stockstobuy #tradingstrategy #technicalanalysis

In today’s video, we are breaking down a massive valuation mismatch. While the market is distracted by short-term noise, the fundamentals for Adobe ($ADBE) and Duolingo ($DUOL) suggest they are trading at a significant discount based on their 2025 guidance. We're looking at the "Guidance Gap" - where actual revenue growth is outpacing the Price-to-Sales multiple expansion.

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What is Adobe? $ADBE
Adobe Inc. is the leader in the digital creativity and document productivity space. While most people know them for Photoshop or PDFs, investors should view them as a diversified SaaS (Software as a Service) giant operating across three massive pillars:

Creative Cloud: The industry standard for design, photography, and video (Photoshop, Premiere Pro, Illustrator). It’s powered by a high-retention subscription model that has become the "operating system" for the world’s creators.

Document Cloud: Centered around Acrobat and the PDF format, this segment is a cash-flow machine that dominates enterprise workflows and digital signatures.

Experience Cloud: Adobe’s foray into marketing, analytics, and e-commerce. It helps the world’s largest brands manage their customer journeys from start to finish.

The 2025 Catalyst: Adobe has successfully integrated Generative AI (Adobe Firefly) across its entire suite. Despite concerns about AI competition, Adobe’s 2025 guidance shows a company that is not just surviving - but thriving - as it targets over $26 Billion in total revenue for the 2026 fiscal year.

What is Price to Sales?
The Price-to-Sales (P/S) Ratio is a valuation metric that compares a company’s total value (Market Cap) to its total revenue.

Why I’m using Price to Sales for this analysis:
Revenue is Harder to "Fake": Unlike earnings, which can be adjusted by accounting tricks, taxes, or one-time expenses, revenue is a straightforward look at how much money customers are actually handing over.

The "Forward" Advantage: By using 2025 Guidance, we can calculate a Forward P/S. If a company's stock price stays flat while its revenue is projected to jump 20%, that stock is effectively getting "cheaper" every day.

Ideal for Growth & SaaS: For companies like Adobe and Duolingo that reinvest heavily in AI and R&D, P/E ratios can often look artificially high. The P/S ratio allows us to see the true scale of the business relative to its price tag.

Adobe currently trades at a price to sales of 5.4 while the average price to sales is 13. Historically, investors were willing to pay $13 for every dollar in revenue the company generated. However, investors now are only willing to pay $5 for every dollar in revenue Adobe generates.

What is Duolingo? $DUOL
Duolingo is the world’s leading mobile learning platform, famously known for its gamified approach to language education. However, in 2025, Duolingo has evolved into much more than just a language app; it is now an AI-driven "Learning Operating System" spanning multiple subjects including Math, Music, and Chess.

The Duolingo Business Engine:
The Freemium Model: With over 135 million Monthly Active Users (MAUs), Duolingo uses a massive free user base to fuel its data-driven A/B testing, which in turn optimizes its conversion into paid subscribers.

Duolingo Max (The AI Growth Lever): This new premium tier uses GPT-4 to offer features like "Roleplay" and "Explain My Answer." This high-margin tier is driving a significant increase in Average Revenue Per User (ARPU).

Diversified Revenue: Beyond subscriptions, Duolingo generates high-margin revenue through the Duolingo English Test (DET) - a digital-first proficiency exam accepted by over 5,000 institutions - and its growing advertising business.

This is not financial advice.