Hold onto these two software leaders

Article Excerpt

Adobe and Fair Isaac have surged to record highs in the past year. As a result, their shares are expensive in relation to their projected earnings. We feel investors should delay new buying until those earnings catch up to their prices. ADOBE SYSTEMS INC. $172 (Nasdaq symbol ADBE; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 492.9 million; Market cap: $84.8 billion; Price-to-sales ratio: 12.3; No dividends paid since June 2005; TSINetwork Rating: Average; www. adobe.com) makes software that lets computer users create, edit and share documents in the popular PDF format. Graphic designers also use its programs to create print publications and web pages. In its fiscal 2017 third quarter, ended September 1, 2017, the company earned $1.10 a share (or $549.1 million). That’s up 46.7% from $0.75 a share (or $376.5 million) a year earlier. Revenue also jumped 25.8%, to a record $1.84 billion from $1.46 billion. Adobe continues to move away from the sale of software as a..