For those looking to find strong Computer and Technology stocks, it is prudent to search for companies in the group that are outperforming their peers. Adobe Systems (ADBE) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Computer and Technology sector should help us answer this question.
Adobe Systems is one of 623 individual stocks in the Computer and Technology sector. Collectively, these companies sit at #6 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.
The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. Adobe Systems is currently sporting a Zacks Rank of #2 (Buy).
Over the past 90 days, the Zacks Consensus Estimate for ADBE's full-year earnings has moved 2.3% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.
Based on the most recent data, ADBE has returned 73.7% so far this year. At the same time, Computer and Technology stocks have gained an average of 50%. This means that Adobe Systems is performing better than its sector in terms of year-to-date returns.
One other Computer and Technology stock that has outperformed the sector so far this year is Datadog (DDOG). The stock is up 66.8% year-to-date.
The consensus estimate for Datadog's current year EPS has increased 6700% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
Looking more specifically, Adobe Systems belongs to the Computer - Software industry, a group that includes 36 individual stocks and currently sits at #79 in the Zacks Industry Rank. This group has gained an average of 52.9% so far this year, so ADBE is performing better in this area.
In contrast, Datadog falls under the Internet - Software industry. Currently, this industry has 147 stocks and is ranked #26. Since the beginning of the year, the industry has moved +65.6%.
Going forward, investors interested in Computer and Technology stocks should continue to pay close attention to Adobe Systems and Datadog as they could maintain their solid performance.
Zacks Naming Top 10 Stocks for 2024
Want to be tipped off early to our 10 top picks for the entirety of 2024?
History suggests their performance could be sensational.
From 2012 (when our Director of Research, Sheraz Mian assumed responsibility for the portfolio) through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2024. Don’t miss your chance to get in on these stocks when they’re released on January 2.
Be First to New Top 10 Stocks >>Adobe Inc. (ADBE) : Free Stock Analysis Report
Datadog, Inc. (DDOG) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
