5 Best Rebound Stocks To Buy Now

In this article, we will take a look at the 5 best rebound stocks to buy now. If you want to see some more of the stocks, go to 10 Best Rebound Stocks To Buy Now.

5. Adobe Inc. (NASDAQ:ADBE)

Number of Hedge Fund Holders: 92 

YTD Price Change: -44.0%

Adobe Inc. (NASDAQ:ADBE) is a Mountain View, California-based diversified software company that aids users in creating, delivering, and optimizing content through its offerings.

Adobe Inc. (NASDAQ:ADBE) is expected to emerge as one of the best rebound stocks after its acquisition of Figma for nearly $20 billion by 2023. Figma is a close competitor of Adobe, and the acquisition will allow the company to increase its total addressable market (TAM). Figma is projected to reach a TAM of $16.5 billion by 2025. On October 19, Matthew Swanson at RBC Capital gave Adobe Inc. (NASDAQ:ADBE) stock a target price of $395 and reiterated an Outperform rating. The analyst highlighted that during the Adobe Max event, the company unveiled the accessibility and usability of its creative suite along with its artificial intelligence (AI) and machine learning abilities. These developments are expected to boost the stock price of Adobe Inc. (NASDAQ:ADBE) in the long run.

Here’s what Andvari Associates said about Adobe Inc. (NASDAQ:ADBE) in its Q3 2022 investor letter:

“The only company-specific news worth mentioning is Adobe Inc. (NASDAQ:ADBE)’s announcement in September that it will acquire collaborative design platform Figma for $20 billion. Adobe’s share price dropped 16.8% on the day of the announcement. Shareholders signaled that paying an extraordinary 50x Figma’s annualized run-rate revenues is likely to destroy value.

Although Andvari is skeptical of this deal, there are a few reasons why it could turn out to be a decent use of capital. First is Figma’s astounding growth. Since its first dollar of revenue in late 2017, Figma has grown to $400 million in annualized revenues in just five years. Furthermore, they achieved this growth through the viral adoption of their product, not by employing an army of salespeople. Second, Adobe is experienced at acquiring products and then accelerating growth with its distribution network and access to large enterprise customers. Adobe built its suite of products over the decades by making over fifty acquisitions. Adobe even acquired its best-known product, Photoshop. Andvari thinks Figma can continue its rapid growth when it has access to Adobe’s ability to spend $5 billion annually on sales and marketing.”