Adobe Inc (NASDAQ: ADBE) witnessed a significant 3.41% drop in its stock value, wrapping up the last trading session at $521.14. The volume of Adobe shares exchanged on the day amounted to 2.52 million, which is a departure from its average weekly trading volume of 2.63 million. Notably, this decline in ADBE stock occurred despite an analyst recommendation upgrade.
On Wednesday, DA Davidson upgraded its recommendation on ADBE stock, elevating it from a “NEUTRAL” rating to a “BUY.” In addition to this positive shift, the analyst firm also raised the price target for ADBE from $500 to $640.
Nevertheless, in the premarket session today, Adobe (ADBE) stock displayed signs of recovery, with its stock price increasing by almost 1% to approximately $525 at the latest assessment.
In a separate development, the United Kingdom’s competition regulatory authority extended the deadline for its comprehensive investigation into Adobe’s $20 billion acquisition of the cloud-based design platform Figma by an additional eight weeks, setting the new deadline for February 2024. This extension was announced on Wednesday.
The Competition and Markets Authority (CMA) initiated an in-depth, or phase two, investigation into the deal in July, prompted by ADBE’s declaration that it would not make any concessions to address the regulator’s concerns. The CMA is presently set to finalize its examination on February 25, marking an extension from the prior cutoff date of December 27. This scrutiny is being overseen by a panel of autonomous specialists handpicked by the CMA.
The CMA stated that both companies have presented comprehensive arguments pertaining to their competition concerns in product development, growth strategies, and their potential impact on venturing into new markets.
Notably, in September 2022, Adobe unveiled a cash-and-stock deal to acquire Figma, marking it as the largest acquisition of a privately held software startup. Figma’s web-based collaborative platform for design and ideation enjoys significant popularity among technology-oriented companies, including Zoom Video Communications, Airbnb Inc, and Coinbase.
