Shares of Intuit Inc. (INTU) took a dip on Friday, despite the company reporting robust quarterly results. This comes amid a flurry of earnings reports from various companies. Let’s delve into the key takeaways from analysts covering Intuit.
BofA Securities
Analyst Brad Sills maintained a Buy rating on Intuit and raised the price target from $730 to $780. Sills highlighted that Intuit delivered “solid” quarterly results, with total revenue exceeding expectations by $100 million. This growth was fueled by a strong performance from the small business segment (20% growth) and Credit Karma (14% growth). While fiscal 2025 guidance aligned with expectations, management revised the long-term growth outlook from 8%-12% to 6%-10%. Sills viewed this adjustment as a more realistic and achievable goal, especially with Intuit’s focus on expanding its full-service segment. He also expressed optimism about the potential of Intuit Assist, an AI-powered offering designed to streamline returns processing and enhance marketing efforts.
JPMorgan
Analyst Mark Murphy kept a Neutral rating on Intuit but lifted the price target from $585 to $600. Murphy acknowledged the impressive 17% revenue growth, exceeding expectations. He also praised Intuit’s profitability, though he noted a decline in free cash flow margin, the drivers of which remain unclear. Despite the macro headwinds and exposure to small and medium-sized businesses (SMBs), Murphy viewed the in-line to slightly above expectation full-year guidance as a positive sign. While recognizing the back-end loaded FY25 guidance framework, Murphy attributed it to accounting dynamics and expressed confidence in Intuit’s track record of execution.
Goldman Sachs
Analyst Kash Rangan reiterated a Buy rating and maintained a price target of $765. Rangan lauded Intuit’s strong performance, with “metrics largely achieved” and full-year guidance aligning with consensus. He highlighted the company’s focus on the mid-market, characterized by more complex customers, and its AI investments, particularly Intuit Assist, a generative AI tool. Rangan believes these AI investments can yield significant benefits by addressing the complex needs of mid-market clients, complementing Intuit’s existing capabilities in bookkeeping and accounting. He even envisioned potential expansion into emerging areas, such as supporting CFO-esque tasks.
Despite the positive sentiment from some analysts, Intuit’s shares experienced a decline of 7.77% to $613.62 at the time of publication. This decline may be attributed to concerns regarding the long-term growth outlook and the reduction in free cash flow margin. Investors will likely be watching closely to see how Intuit navigates these challenges and whether its AI investments can drive sustained growth.
