If You'd Put $1,000 Into Adobe Stock 20 Years Ago, Here's What You'd Have Today
Adobe stock has outperformed the S&P 500 by leaps and bounds over the past two decades.
The promise of generative artificial intelligence hasn't been able to keep Adobe (ADBE) stock afloat this year, but long-time shareholders are still sitting on market-crushing returns.
After adding 77% last year, shares in the maker of application software for creative types lagged the broader market by more than 35 percentage points for the year to date through early December. The company's announcement a year ago that it would add AI tools to Photoshop lit a second-half fire under Adobe stock. But then a pullback of some kind following such a torrid run isn't unusual for any name. Besides, many steps forward and a few steps back is sort of par for the course for volatile ADBE stock.
And make no mistake: jumping on the AI bandwagon was just what Adobe needed. For years, the company enjoyed a near monopoly in its niche. Its Creative Suite – which includes the likes of Photoshop, Premiere Pro for video editing and Dreamweaver for website design, among others – really had no peer.
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But times change. The emergence of Microsoft's (MSFT) Azure and other cloud-based competitors have taken a bite out of Creative Cloud. Adobe's suite of products still commands a market share of more than 60%, but there's no question the company – and its shareholders – have been feeling the heat.
Just look at how shares have slowed down over the past few years.
Adobe stock has outperformed the S&P 500 by a wide margin over the course of its life as a publicly traded company, generating an all-time total return of 23%. By comparison, the broader market returned 10.7% over the same span.
The early 2020s have been a different story entirely. A terrible 2022 and an awful 2024 has ABDE stock trailing the broader market by wide margins over the past one- and three-year periods.
The bottom line on Adobe stock
Adobe's hot 2023 run was a lot more like what longtime shareholders have come to expect from the stock. After all, anyone who plonked down just a thousand bucks into ADBE a couple of decades ago would have enjoyed truly outstanding returns.
Have a look at the chart below and you'll see that a $1,000 investment in Adobe stock 20 years ago would today be worth more than $18,000. The same money invested in the broader market would theoretically have grown to about $7,600.
True, Adobe stock remains about a quarter below its all-time closing high set back in November 2021, but analysts think it can reclaim those levels eventually.
After all, Wall Street is pretty bullish on the name. Of the 39 analysts issuing opinions on Adobe stock surveyed by S&P Global Market Intelligence, 20 rate it at Strong Buy, nine call it a Buy, seven have it at Hold, two rate it at Sell and one says Strong Sell. That works out to a consensus recommendation of Buy, with solid conviction.
More Stocks of the Past 20 Years
- If You'd Put $1,000 Into Nvidia Stock 20 Years Ago, Here's What You'd Have Today
- If You'd Put $1,000 Into Apple Stock 20 Years Ago, Here's What You'd Have Today
- If You'd Put $1,000 Into Amazon Stock 20 Years Ago, Here's What You'd Have Today
- If You'd Put $1,000 Into Microsoft Stock 20 Years Ago, Here's What You'd Have Today
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Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.
A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.
Once upon a time – before his days as a financial reporter and assistant financial editor at legendary fashion trade paper Women's Wear Daily – Dan worked for Spy magazine, scribbled away at Time Inc. and contributed to Maxim magazine back when lad mags were a thing. He's also written for Esquire magazine's Dubious Achievements Awards.
In his current role at Kiplinger, Dan writes about equities, fixed income, currencies, commodities, funds, macroeconomics, demographics, real estate, cost of living indexes and more.
Dan holds a bachelor's degree from Oberlin College and a master's degree from Columbia University.
Disclosure: Dan does not trade stocks or other securities. Rather, he dollar-cost averages into cheap funds and index funds and holds them forever in tax-advantaged accounts.
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