Motley Fool: Creative giant Adobe still has a capacity for innovation - The Dallas Morning News

The Motley Fool Take

For decades, Adobe has been a leader in creative and business software, with many of its products now the gold standards in their respective industries. That includes Photoshop for image editing, Premiere Pro for video editing and Illustrator for vector graphics. Adobe's digital media segment also includes Acrobat, an application for creating, editing and sharing digital documents via the ubiquitous PDF file format.

Adobe also offers solutions for analytics, marketing and commerce, helping organizations engage with and delight consumers with personalized content. Adobe's two complementary suites of software (Creative Cloud and Experience Cloud) collectively facilitate the creation and delivery of digital content. The company has achieved a strong competitive position in multiple markets, which has translated into strong financial results. For example, in its first quarter of fiscal 2022, adjusted revenue grew 17% year over year, while cash flow from operations came in at $1.77 billion.

Adobe's lineup of industry-leading products and its capacity for innovation should drive growth for years to come. And with newer creativity tools like Substance 3D for 3D design and Aero for augmented reality, Adobe could even be a key player in the growing metaverse industry.

Recently, Adobe's stock has been attractively priced. (The Motley Fool has positions in and has recommended Adobe.)

Ask the Fool

From M.L. in Kinston, N.C.: I want to invest in some stocks and maybe a mutual fund, too. How do I actually do that?

The Fool responds: For stocks, open an account at a respectable brokerage. (You can read about some good ones at Broker.Fool.com.) It's generally easy to do: You'll fill out an application and deposit money into the account, then you can begin buying and selling. You can probably set it all up online, too. Most good brokerages will let you set up individual retirement accounts as well as regular taxable accounts.

Many brokerages offer access to zillions of mutual funds, so you may be able to invest in your fund(s) of interest in your brokerage account. (A workplace 401(k) account will generally offer some mutual fund options as well.) Otherwise, click over to the mutual fund's parent company (such as Vanguard or Fidelity) and see if you can invest directly from there. Some funds have minimum initial investment requirements, such as $500 or $3,000.

You can look up mutual fund track records, fees and other information at Morningstar.com. Look into exchange-traded funds, too — they're like mutual funds but trade like stocks, with no minimum investment requirements.

Note that for many of us, low-fee index funds, such as ones that track the S&P 500, are the easiest and best way to get into stocks.

Related:Active mutual funds can't measure up to indexes — again

From V.S. in Syracuse, N.Y.: I don't read the footnotes in companies' financial reports. Should I?

The Fool responds: Ideally, yes — you can run across some useful things to know. These might include the accounting methods the company uses when preparing its financial reports or the various interest rates that the company is paying on its debts.

The Fool's School

Learning about and from Warren Buffett can improve your money management and investing results.

Buffett turns 92 this year, and he has been diligently making money for more than 80 years. He has topped lists of the richest people in both the United States and the world many times, though his fortune is smaller now than it would be if he hadn't been giving away billions for many years. The philanthropist, who's based in Omaha, Neb., donated more than $4 billion in 2021, and he has given away more than $46 billion over his lifetime. Still, his net worth was recently $93.4 billion.

FILE - In this May 5, 2019, file photo, Warren Buffett, chairman and CEO of Berkshire Hathaway, speaks during a game of bridge after the annual Berkshire Hathaway shareholders meeting in Omaha, Neb. (Nati Harnik / ASSOCIATED PRESS)

How did he get so rich? Well, by investing. He started working hard when he was still a young boy, and he bought his first shares of stock at 11. In 1965, he became the majority owner of Berkshire Hathaway, a struggling textile company. That company didn't make him rich, but his various other investments did, and over time, he built Berkshire Hathaway into a massive conglomerate.

Today Berkshire Hathaway encompasses many companies, such as Benjamin Moore, Brooks, Clayton Homes, Duracell, Forest River, Fruit of the Loom, GEICO Auto Insurance, International Dairy Queen, Justin Brands, McLane, NetJets, Pampered Chef, Precision Castparts, See's Candies, Shaw Industries and the entire BNSF railroad. It also has a sizable stock portfolio, recently owning about 20% of American Express, 12.5% of Bank of America, 9.2% of Coca-Cola and 5.5% of Apple — Berkshire's largest position.

Altogether, over 57 years, Buffett (with his business partner Charlie Munger) has grown Berkshire's value by an annual average of 20% per year, roughly double the growth rate of the S&P 500 — and enough to turn a $1,000 investment into more than $34 million.

Clearly, Warren Buffett knows a thing or two about business and investing. He also likes to share what he knows, and you can learn a lot in his annual letters to shareholders (at BerkshireHathaway.com) and in books such as Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2013 by Carol Loomis (Portfolio, $18).

My Smartest Investment

From S.C., online: My smartest investment has been marrying my wife. Seriously. My net worth has increased tenfold since I got married. That's not because she had crazy amounts of cash but because she and I have been doing well investing. She gives me focus and purpose.

The Fool responds: You're smart to realize that some of our most profitable investments can come from the non-financial things we do. Choosing a partner is a big decision that can have far-reaching consequences, both financial and non-financial.

Before committing to anyone, it's always smart to be sure you have compatible financial goals, philosophies and habits. Otherwise, one person might be saving diligently for the future while the other racks up a lot of credit card debt. Marrying someone generally involves tying your finances and financial futures together, so it's much like an investment. For best results, have regular discussions about your financial goals and your plans and progress toward reaching them.

It can also be a powerful move to invest time in those you love. Spending quality time with your family and friends can be good for you and them in many ways. Time spent with young people can be especially valuable, boosting their confidence, mental health and even physical health.

Investing in your own health by exercising and eating nutritiously can also pay dividends, potentially lengthening your life and keeping health care costs down.

Who am I?

I trace my roots back to 1910, when my founder, then 18, sold two shoeboxes full of picture postcards in Kansas City, Mo. I was soon offering valentines and Christmas cards with accompanying envelopes. I introduced fancy gift wrap in 1917 and collectible ornaments in the 1970s. In 1984, I bought the Crayola crayon business. TV programs I've sponsored have won more than 80 Emmy awards. Today, I'm valued at around $3.5 billion, and I employ about 27,000 people worldwide. My Crown Media subsidiary boasts three cable channels, and I even have a real estate development company. Who am I?

Don't remember last week's question? Find it here.

Last week's trivia answer: EssilorLuxottica

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