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    Adobe (ADBE) Tests Its AI Story Following NHL Deal And Undervalued Narrative

    Simply Wall St·10/02/2026 19:13:27
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    Adobe (ADBE) has just tied its AI and marketing engine to one of the biggest sports stages on the planet, becoming the National Hockey League’s Official Creative, Marketing and AI Partner.

    Despite fresh AI partnerships with the NHL and Jet2, Adobe’s recent share price return tells a different story. The 30 day move is down 15.66% and the year to date share price return is down 27.61%, while the 1 year total shareholder return has declined 31.35%. This points to fading momentum after a 9.81% 90 day share price gain and a much steeper 53.28% and 58.33% drop in total shareholder return over 3 and 5 years respectively.

    Spot emerging AI experience leaders alongside Adobe by scanning our curated list of 90 AI infrastructure stocks, which are shaping how data, creativity, and real-time engagement come together for customers and fans.

    Bulls point to Adobe’s AI reach and a 13x trailing P/E. Bears focus on a share price that has fallen far faster than earnings. Which story does the current valuation actually support next?

    Most Popular Narrative: 24.6% Undervalued

    Against Adobe’s last close at $241.28, the most followed narrative pegs fair value near $320, which frames the current AI-fueled debate as a potential pricing mismatch rather than a verdict on the business.

    Using these facts, if I project the Free Cash Flow for the next 10 years and discount it back at the cost of capital, Adobe's net present value of a stock stands at $317.27. The intrinsic value of Adobe's stock per my estimate.

    See why 116 investors see Adobe as 25% undervalued.

    According to HarishPK, the narrative leans on Adobe’s cash generation, return on invested capital, and margins as evidence that the creative software and marketing platform still throws off high quality earnings despite intensifying AI competition.

    The author’s Monte Carlo framework reinforces that view through 10,000 DCF simulations that stress test lower growth and thinner operating margins, yet still support a fair value range above the current $241.28 share price in many scenarios.

    For readers weighing whether today’s selloff simply reflects sentiment or a reset in fundamentals, this narrative anchors the discussion around free cash flow durability rather than short term multiple compression.

    Result: Fair Value of $319.96 (UNDERVALUED)

    Still, Adobe’s AI moat could narrow faster than expected if rivals convert new tools into sticky workflows, and any sustained margin pressure would quickly challenge this undervaluation story.

    Find out about the key risks to this Adobe narrative.

    Next Steps

    If the mix of AI deals and share price pressure leaves you unsure about sentiment on Adobe, move quickly to check the full picture for yourself and weigh both sides of the risk reward debate with 4 key rewards and 1 important warning sign.

    Looking for more Adobe-sized investment ideas?

    If Adobe has you thinking harder about valuation, do not stop here. Broaden your watchlist now with focused stock ideas that target different goals and risk levels.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.