Rapid digital transformation across various sectors, significant deployment of cloud-based technologies, and emphasis on innovative technologies are expected to bolster the growth prospects of the software industry. Moreover, despite ongoing macroeconomic headwinds, global software spending is expected to increase at a 10.3% CAGR from 2021 to 2023.
However, software giant Adobe Inc.’s (ADBE) shares have declined 50.4% year-to-date and 26.2% over the past month. The stock still seems pricey in terms of valuation. Its forward Price/Sales multiple of 7.36 is 204.4% higher than the industry average of 2.42. Also, in terms of its forward EV/Sales, it is trading at 7.28x, 205.3% higher than the industry average of 2.38x.
