5 Most Profitable Software Stocks to Buy Right Now

3. Adobe Inc. (NASDAQ:ADBE)

Net Income (TTM): $7.23 billion

Number of Hedge Fund holdings: 86

On June 29, Phillip Securities trimmed the price target on Adobe Inc. (NASDAQ:ADBE) to $203 from $385, while downgrading the stock to Neutral from Buy. Although legacy software-as-a-service “remains resilient due to its mission-critical nature and reliability,” the firm said company growth has lagged even with an early advantage in AI.

Phillip Securities noted that while AI adoption is advancing, its contribution to overall revenue will likely remain minimal in the years ahead. This contrasts with competitors that are already experiencing significant AI-powered monetization, the firm added. With that said, the firm expects only a modest upside in the near-term valuation outlook for the application software market.

Three days earlier, Piper Sandler reaffirmed a Neutral on Adobe Inc. (NASDAQ:ADBE) with a price target of $240. This followed the company’s announcement that it had acquired Topaz Labs, a provider of AI models for video and image enhancement. While describing the company’s competitive environment as increasingly fierce, the firm said that M&A is the right strategy for the company in the AI and agentic era. With a profit margin of 28.69%, ADBE remains one of the most profitable software stocks to buy right now.

Adobe Inc. (NASDAQ:ADBE) is a California-based technology company operating through Digital Media, Digital Experience, and Publishing and Advertising segments.

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