Jeffrey Ubben‘s ValueAct Capital has reported reducing its exposure to Adobe Systems Incorporated (NASDAQ:ADBE). According to SEC filings, ValueAct has sold 750,000 shares of the company, currently holding some 24.56 million shares. The securities have been disposed in five transactions, the average price amounting to $72.74 per share. The activist stake held by ValueAct after the sale amasses 4.9% of Adobe’s common stock.
ValueAct has been holding shares of Adobe Systems Incorporated (NASDAQ:ADBE) for the last couple of years, although around six months ago, the stake amounted to 31.30 million shares, being decreased to 25.31 million shares during the last quarter of 2014. Nevertheless, Adobe was the fourth-largest stake in ValueAct’s equity portfolio at the end of the first quarter, amassing over 12% of the total 13F portfolio’s value. At the same time, ValueAct is one of the largest shareholders of the company, among institutional investors. Stephen Mandel‘s Lone Pine Capital has also added Adobe Systems Incorporated (NASDAQ:ADBE) to its equity portfolio during the first quarter, reporting 6.6 million shares in its latest 13F filing. Sean Cullinan‘s Point State Capital boosted its stake in the company by more than 800% during the same period, last reporting ownership of 3.49 million shares.
There are plenty of reasons for investors to like this $36 billion application software company. Adobe Systems Incorporated (NASDAQ:ADBE)’s stock went up by 20% since the beginning of the year, and jumped by 57% over the past 52 weeks. It trades at a P/E of above 130, which is one of the highest in the industry and above the average of around 40. At the same time, in the past several quarters, Adobe has been mostly beating the consensus estimates for EPS and revenue. For the last quarter, it reported earnings of $0.30, which is roughly 20% above the estimates. For the whole 2014, Adobe Systems Incorporated (NASDAQ:ADBE) is expected to post earnings of around $1.20 per share, and revenues of $4.2 billion, versus $1.34 and $4.1 billion reported for the last year.