Stock market today: S&P 500 drops for fifth day as focus shifts to Powell’s speech
On Friday, Evercore ISI analyst Kirk Materne increased the price target on Intuit (NASDAQ:INTU) to $785 from $685, while maintaining an Outperform rating on the stock. The revision follows Intuit’s robust fiscal third-quarter results, which surpassed consensus estimates. With a market capitalization of over $200 billion and an "GREAT" financial health score according to InvestingPro, Intuit reported total revenue growth of $7.8 billion, a 15% increase year-over-year, outperforming the expected $7.56 billion. Earnings per share (EPS) also exceeded forecasts, coming in at $11.65 compared to the anticipated $10.93.
A significant highlight from the quarter was the exceptional performance of TurboTax Live, which saw a 47% year-over-year growth, with unit growth reaching 24%. This surge contributed to an 11% revenue increase in the consumer group segment. The company’s impressive gross profit margin of 80.26% underscores its operational efficiency. In the Global Business Services (GBS) division, Online Services grew approximately 20% year-over-year, aligning with expectations despite the ongoing challenges from Mailchimp. Intuit also observed some initial successes with its Intuit Enterprise Suite.
Credit Karma, another Intuit offering, notably outperformed projections, with revenues hitting $579 million, a 31% increase, far exceeding the expected $464 million. Riding on the back of these strong performances, Intuit has updated its full-year guidance. The company now expects mid-point revenue of $18.74 billion, up 15% from the previous forecast of $18.25 billion. Additionally, the EPS range has been adjusted to $20.07-$20.12, up from the earlier estimate of around $19.30.
Materne’s commentary highlighted the successful tax season for Intuit and expressed a positive outlook for the company’s GBS division, especially if improvements can be made with the Mailchimp business. The analyst also pointed out the potential of Intuit’s artificial intelligence monetization and new agentic offerings, particularly for mid-market customers, which are seen as underappreciated opportunities. While the stock is currently trading near its 52-week high and appears overvalued according to InvestingPro’s Fair Value model, 20 analysts have revised their earnings estimates upward for the upcoming period. The price target adjustment to $785 reflects an approximate 30 times enterprise value to calendar year 2026 free cash flow. Discover more insights and 18 additional ProTips about Intuit in the comprehensive Pro Research Report, available exclusively on InvestingPro.
In other recent news, Intuit has reported strong financial results, leading multiple financial firms to adjust their price targets for the company’s stock. Stifel analysts increased their price target from $725 to $850, citing an 11% growth in the Consumer Tax segment and a 47% surge in TurboTaxLive. The Global Business Services segment also saw a 19% increase, with Intuit Ecosystem Solutions and QuickBooks Online Accountant showing a 40% year-over-year growth. KeyBanc followed suit, raising its target to $850, noting impressive third-quarter results that surpassed expectations, particularly in TurboTax and the integration with Credit Karma. Piper Sandler also raised its target to $825, highlighting Intuit’s third-quarter earnings of $11.65 per share and revenues of $7.75 billion, both exceeding forecasts. Meanwhile, BMO Capital Markets increased its target to $820, acknowledging the strength in Intuit’s Consumer segment and Credit Karma business, which is projected to boost earnings per share by 18.5% this fiscal year. Intuit’s focus on artificial intelligence and automation, particularly through TurboTax Live, is anticipated to drive further growth. Despite challenges with Mailchimp, Intuit’s strategic initiatives and market share gains continue to underpin its robust performance.
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