Adobe Inc.

Methodology

Adobe's subscription transition through Creative Cloud creates highly predictable recurring earnings compared to historical perpetual licensing volatility. The dominant position in creative software provides reliable growth visibility. However, Adobe typically trades at substantial premiums above calculated fair values reflecting near-monopoly status and pricing power in creative professional tools.

Methodology

Adobe consistently commands premium PEG ratios reflecting high-margin subscription software with strong retention and pricing power. Consistent double-digit growth and expanding margins justify elevated multiples versus traditional enterprise software. Compare to Adobe's historical range and creative software peers to identify periods of relative over- or under-valuation.

Methodology

Adobe doesn't pay dividends and reinvests capital into product development, acquisitions, and share buybacks, making PEGY identical to PEG. Management prioritizes growth in creative and marketing software over current shareholder yield. Investors focus purely on growth potential from AI-powered tools and platform expansion rather than income generation.