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On Wednesday, Evercore ISI analyst Kirk Materne adjusted the price target for Intuit (NASDAQ:INTU) stock, decreasing it to $700 from the previous $725 while maintaining an Outperform rating. Materne’s statement highlighted Intuit’s solid performance in the second fiscal quarter and reaffirmed its guidance for fiscal year 2025. The analyst expressed optimism about Intuit’s current tax season and ongoing initiatives within the QuickBooks Online (QBO) ecosystem. According to InvestingPro data, Intuit maintains impressive gross profit margins of 79.6% and has achieved revenue growth of 12.5% over the last twelve months, supporting its position as a prominent player in the software industry.
Despite a challenging start to 2025 for Intuit’s stock, Materne anticipates that the company’s recent quarterly results could help stabilize the stock and shift the narrative, which he believes has been excessively negative. The analyst noted that the upside in the quarter was primarily driven by Credit Karma and Desktop, rather than QBO. However, he remains confident in the underlying trends of the business and suggests that meeting tax guidance could be a key factor in unlocking the stock’s value. InvestingPro analysis suggests the stock is currently trading slightly below its Fair Value, with a "GOOD" overall Financial Health Score, indicating strong fundamentals despite recent market pressure.
Intuit’s stock is currently trading at approximately 25 times its calendar year 2026 earnings per share (EPS), a devaluation that Materne believes presents an opportunity. A successful tax season paired with consistent QBO results could lead to a re-rating of the stock and a more favorable risk/reward balance for investors. However, the analyst anticipates that the stock may trade within a certain range until Intuit delivers on its tax promises and investors observe improvements in QBO, as Intuit’s Information Economy Suite (IES) ramps up and Mailchimp’s performance strengthens, which is expected in the second half of calendar year 2025. With a market capitalization of $155.7 billion and trading near its 52-week low, investors seeking deeper insights can access comprehensive analysis and 16 additional ProTips through InvestingPro’s detailed research reports.
In conclusion, Materne reiterated an Outperform rating for Intuit with a revised price target of $700, which reflects approximately 30 times Intuit’s projected calendar year 2026 EPS. The company’s current P/E ratio of 53.6x and strong financial metrics suggest a premium valuation, supported by its consistent dividend growth and robust market position.
In other recent news, Intuit Inc. reported its second-quarter fiscal year 2025 earnings, which exceeded market expectations. The company achieved an earnings per share of $3.32, significantly above the forecasted $2.58, while revenue reached $4 billion, surpassing the anticipated $3.83 billion. Morgan Stanley (NYSE:MS) upgraded Intuit’s stock rating from Equalweight to Overweight, setting a new price target of $730, citing the company’s strong performance in its small business segment. Analysts from Morgan Stanley highlighted an improved demand environment and an enhanced product offering as key drivers for Intuit’s growth. Intuit’s small business segment is expected to maintain a growth rate of over 20%, contributing positively to the company’s outlook.
The company also introduced new AI-driven products aimed at enhancing customer experience, which have been well-received. Intuit’s CEO, Sasan Gudarzi, expressed confidence in the company’s growth trajectory, reiterating full-year guidance with projected revenue growth of 12-13% and GAAP operating income growth of 28-30%. The company remains optimistic about its ability to achieve double-digit revenue growth and expand its online ecosystem revenue by approximately 20% in fiscal year 2025. Intuit’s strategic focus on AI-driven solutions and expansion in the small business market have been pivotal to its strong performance.
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