** Shares of Photoshop maker Adobe ADBE.O down 3.04% at $427.43; hitting their lowest level since June 2023
** Brokerage UBS maintains a "neutral" rating, cuts stock's PT to $475 from $525
** New PT represents a 7.7% upside to the stock's last closing price
** Brokerage takes the example of commercials released by Coca-Cola in mid-November 2024 and a previous ad released by Toys "R" Us - both being entirely AI-generated - noting that this could be tipping point to a material increase in AI-based advertising or marketing content
** UBS notes that these ads did not use Adobe AI tools for content creation and instead opted for rivals such as OpenAI
** "The creative AI market is fiercely competitive, with
OpenAI, Runway and Midjourney the early leaders" - UBS analysts say, adding that ADBE was not at feature parity with these leaders
** In December, ADBE had forecast fiscal 2025 revenue below Wall Street estimates
** Thirty of the 40 analysts covering the stock rate it "buy" or higher; their median PT is $600.61, according to data compiled by LSEG
** ADBE shares fell more than 25% in 2024
(Reporting by Sanchayaita Roy in Bengaluru)
((Sanchayaita.Roy@thomsonreuters.com))
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