ADBE Value Scorecard - Adobe Inc.

Value Scorecard · run 2026-10-18

13 value checks: 12 scored 1 to 5, plus moat evidence

54/60

high value score

Earnings & returns

EPS Trend

5/5

Diluted EPS: $10.10 (2022), $11.82 (2023), $12.36 (2024), $16.70 (2025). It rose every year; the framework scores that as 5.

ROE Trend

5/5

ROE (net income / common equity): 33.8% (2022), 32.9% (2023), 39.4% (2024), 61.3% (2025). Median 36.6%, lowest 32.9%; the framework scores a median above 20% as 5.

ROIC

5/5

ROIC of 45.1%: operating income of $8.71B divided by $19.30B of capital (total assets $29.50B minus current liabilities $10.20B), fiscal year to Nov 28, 2025, as filed in the 10-K (SEC EDGAR). The framework scores above 20% as 5.

Profit Margins

5/5

Net margin of 28.0%; the framework scores above 20% as 5; gross margin 89.3%, operating margin 34.8%.

Balance sheet & cash

Debt-to-Equity

4/5

Debt-to-equity of 0.58; the framework scores 0.3-0.8 as 4 (total debt $6.79B, total cash $5.64B).

Free Cash Flow

4/5

Free cash flow (operating cash flow minus capital expenditure): $7.40B (2022), $6.94B (2023), $7.87B (2024), $9.85B (2025). It rose every year but one and ended above 2022; the framework scores that as 4.

Retained Earnings

5/5

Retained earnings, as filed in the 10-Ks (SEC EDGAR): $28.32B (2022), $33.35B (2023), $38.47B (2024), $45.35B (2025). It rose every year; the framework scores that as 5.

Valuation models

Graham IV

5/5

IV = EPS x (8.5 + 2g) x (4.4 / Y) = $17.91 x (8.5 + 2 x 18.9) x (4.4 / 4.5) = $810.81. Current price $245.20; price is 69.8% below the model value.

DCF Value

5/5

FCF/share = $24.011, stage 1 growth = 10.7% for 5 years, terminal growth = 3%, discount rate = 10%. Stage 1 PV = $122.37, PV of terminal value = $364.69, DCF value = $487.06. Current price $245.20; price is 49.7% below the model value.

Margin of Safety

5/5

Graham value $810.81 (price is 69.8% below the model value); DCF value $487.06 (price is 49.7% below the model value).

Price-to-Book

1/5

P/B of 8.15; the framework scores above 5.0 as 1.

Business quality

Moat Evidence

Not scored

A moat (a brand, a network, switching costs, patents, scale, a licence) is not a number in the filings, so Valerius doesn’t score it. Below are the figures and the words moat analysis starts from, from the company’s own 10-K filings. The conclusion is yours.

Return on capital, each year

Above 15% in 10 of 10 years (2016-2025); lowest 15.1%, highest 45.1%.

Gross margin, each year

Between 85.0% and 89.3% over 10 years (a range of 4.3 points).

Competition, in the company’s own words · 10-K filed Jan 15, 2026

We participate in a highly competitive and rapidly evolving environment where our competitors include companies of various sizes and both public and private companies, including large, global companies and smaller companies with more specialized focuses, new entrants, and AI or cloud-native companies. We compete with software companies, AI companies, hardware manufacturers, operating system developers, and social

The opening of the company’s “COMPETITION” section in its 10-K, quoted word for word, not summarized or edited. It is the company’s own description, not Valerius’s view, and may include the company’s expectations. Open the filing.

Return on capital = operating income / (total assets − current liabilities), the ROIC row’s definition; 15% is the framework’s return threshold. Gross margin = gross profit / revenue. Both from each year’s 10-K via SEC EDGAR. Moat analysis commonly looks at whether returns and margins held up over many years. These figures don’t say whether the company has an advantage, what it is, or whether it will last.

Capital Allocation

5/5

Capital allocation, 2022-2025: dividends or buybacks paid in every year (pass); $31.73B paid out against $32.06B of free cash flow (pass); total debt $4.63B to $6.65B, up 43.5%, 0.7x EBITDA (pass: at most 2x EBITDA); shares outstanding 0.46B to 0.41B, down 10.6% (pass). 4 of 4 tests passed; the framework scores that as 5.

Filings

Company notices to the SEC

Not scored

Three kinds of event the company reported to the SEC in the last 5 years, from its filings on SEC EDGAR.

These are events the company reported to the SEC. An auditor change or a late filing can have many causes; each date links to the filing, where the company explains it. Valerius does not score these.

How the Graham and DCF values were calculated

  Graham Formula:
    IV = EPS x (8.5 + 2g) x (4.4 / Y)
    EPS = $17.91, g = 18.9%, Y = 4.5
    IV = $810.81
    Current price $245.20 vs Graham value $810.81 — price is 69.8% below the model value.

  DCF:
    FCF/share = $24.011
    Stage 1 growth = 10.7% for 5 years | terminal growth = 3.0% | discount rate = 10.0%
      Y1: $26.580 → PV $24.164
      Y2: $29.424 → PV $24.318
      Y3: $32.573 → PV $24.472
      Y4: $36.058 → PV $24.628
      Y5: $39.916 → PV $24.785
    Stage 1 PV sum = $122.37
    Terminal value at end of Y5 = $587.34
    PV of terminal value = $364.69
    DCF value = $487.06
    Current price $245.20 vs DCF value $487.06 — price is 49.7% below the model value.

Data from yfinance summary figures and financial statements, and from the company’s 10-K filings via SEC EDGAR; computed at a price of $245.20. Every score is calculated from the figures by the framework’s fixed rules, and the explanation beside it is generated from the same figures: Graham value, DCF value, margin of safety, ROIC, profit margins, debt-to-equity, price-to-book, EPS trend, ROE trend, free cash flow, retained earnings and capital allocation. No AI is involved in this scorecard. The moat is shown as evidence, without a score. Read each score with the figures beside it. Intrinsic value calculations are model outputs based on stated assumptions, not predictions.

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