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Shares of Adobe Hit New Highs

The stock hit new 52-week and all-time highs, although its 4% after-hours gain will have to hold up until Wednesday’s session to officially count.

Adobe (NASDAQ:ADBE) beat on earnings per share estimates and marginally topped revenue expectations. Initially the stock traded lower in post-market action, but it has since shot up toward $104.75 a share. Its previous high mark stands at $104.16.

Since switching to a subscription-based model, shares of Adobe have been on fire. And in fact, the stock has been a monster, up almost 300% over the past five years alone.

Some investors may just assume Adobe has been rolling along for years, like Google or Amazon. But that’s not the case. In the five years prior to that period (so Sept. 2006 to Sept. 2011), the stock was actually down 31%.

So the turnaround is very much noteworthy. It’s products are loved by many and its 20% year-over-year sales growth shows that momentum remains strong. Despite the company’s strong performance and the stock’s resilience, the valuation has to be becoming a concern. It’s price-to-sales ratio remains elevated at 9.5x, while its P/E ratio of 57 is sure to keep some investors away.

However, despite the numbers, Adobe keeps delivering. It expects EPS of 83 cents to 89 cents on $1.55 billion to $1.6 billion in sales for next quarter, both ahead of consensus estimates of 78 cents per share on $1.57 billion. It’s full-year revenue guidance is also ahead of analysts’ average estimates.