Wall Street Downgrades: Stocks to Watch Amid Deteriorating Fundamentals and Weak Competition

Analysts have recently downgraded Adobe Systems, The Trade Desk, and C3.ai due to deteriorating fundamentals, weaker competitive positions, and challenging macroeconomic environments. Investors should reassess their investment strategy and consider the reasons behind these downgrades. Adobe's stock price may face 7.1% downside potential, while The Trade Desk and C3.ai face 5.3% and 21.1% downside potential, respectively.

Analysts have recently downgraded Adobe Systems (ADBE), The Trade Desk (TTD), and C3.ai (AI) due to deteriorating fundamentals, weaker competitive positions, and challenging macroeconomic environments. Investors should reassess their investment strategy and consider the reasons behind these downgrades.

Adobe's stock price may face 7.1% downside potential, while The Trade Desk and C3.ai face 5.3% and 21.1% downside potential, respectively. Adobe's stock rose 3.73% on August 13, 2025, with a trading volume of $1.52 billion, ranking 52nd in market activity [1]. However, the company has faced prolonged pressure amid skepticism over its AI-driven growth prospects. Melius Research downgraded Adobe to "Sell," citing risks of value shifting toward firms like Microsoft and Oracle as AI evolves [1]. Meanwhile, some analysts argue Adobe’s current valuation, trading at a 10-year low multiple of 16.7x 2025 earnings, presents an attractive entry point despite structural challenges [1].

The Trade Desk, Inc. (NASDAQ:TTD) is one of the best falling stocks to buy now. On August 11, Jefferies downgraded The Trade Desk shares from a “Buy” rating to “Hold” and cut its price target from $95 to $50 [2]. The company faces increased competition, particularly from Amazon (NASDAQ:AMZN), which secured content deals with Roku (NASDAQ:ROKU) and Walt Disney (NYSE:DIS) [2]. The firm cited additional pressures, including advertisers shifting budgets to the first quarter to avoid tariff-related uncertainty, senior management changes, a major company reorganization, and a slower-than-expected rollout of The Trade Desk’s new Kokai platform [2].

C3.ai (NYSE:AI) was downgraded to Perform from Outperform by Oppenheimer due to weaker-than-expected preliminary results for the first quarter of fiscal 2026 [3]. Oppenheimer also removed its $45 price target on the stock. Shares had jumped 5% by noon trading on Wednesday [3]. The company significantly lowered revenue expectations for 1Q26, from ~$105M to ~$70M, implying a 35% sequential decline and a major concern given the recurring nature of its Subscription revenues, suggesting the services are not working as advertised [3].

These downgrades highlight the challenges faced by these companies in the current market environment. Investors should closely monitor the earnings calls and future performance of these companies to make informed investment decisions.

References:
[1] https://www.ainvest.com/news/adobe-stock-climbs-3-73-52nd-highest-1-52b-volume-melius-downgrade-ai-competition-clash-attractive-valuation-hopes-2508/
[2] https://finance.yahoo.com/news/jefferies-downgrades-trade-desk-ttd-193230572.html
[3] https://seekingalpha.com/news/4484773-c3-ai-receives-downgrade-due-to-weak-preliminary-q1-results-oppenheimer