KeyBanc maintains Intuit stock Overweight with $770 target

On Thursday, KeyBanc Capital Markets maintained a positive outlook on Intuit Inc. (NASDAQ:INTU) stock, reiterating an Overweight rating and a $770.00 price target. The target represents significant upside potential for the software giant, which currently trades at $617.51. According to InvestingPro data, Intuit maintains impressive gross profit margins of nearly 80% and has consistently raised its dividend for 14 consecutive years. The firm’s analyst, Alex Markgraff, provided an update on Intuit’s performance, highlighting data from the company’s TurboTax product line.

The Key First Look/TurboTax analysis, which incorporates data up to March 2, 2025, revealed a slight increase in Average Revenue Per Transaction (JO:TCPJ) (ARPT) growth to 3.0%, up from 2.4% at the start of the tax season. This growth is slightly below the 3.3% growth rate seen during the same period in the previous year. This modest growth comes as Intuit demonstrates strong overall revenue growth of 13.7% over the last twelve months, with analysts forecasting 12% growth for fiscal year 2025.

Markgraff noted the historical trend of ARPT growth accelerating towards the latter part of the tax season and considered the possibility of a slower start to this year’s tax season. When focusing on data specific to Intuit’s fiscal third quarter rather than the start of the tax season on January 27, the ARPT growth was observed at 3.5%, which is an increase from the 2.6% growth recorded for the same period last year.

The analysis also indicated a favorable shift towards higher ARPT dollar buckets, with transactions over $100 showing an approximate 1% increase for the 2025 tax season through March 2 compared to the 2024 tax season. KeyBanc’s analyst expressed continued optimism for Intuit’s consumer group revenue growth for the fiscal year 2024, which is expected to include around 7% growth in Average Revenue Per Return (ARPR) and a slight acceleration in revenue growth from TurboTax Live.

In other recent news, Intuit Inc. has reported strong financial results for the second quarter, with revenues reaching $3.96 billion, surpassing analyst expectations by approximately $120 million. The earnings per share (EPS) also exceeded forecasts, coming in at $3.32, which was $0.75 higher than anticipated. Piper Sandler responded by raising its price target for Intuit to $785, maintaining an Overweight rating, reflecting confidence in the company’s trajectory and AI-driven initiatives. Meanwhile, Mizuho (NYSE:MFG) Securities increased its price target to $765, citing robust performance in Intuit’s TurboTax franchise and positive trends in its Credit Karma operation.

Despite these positive developments, Scotiabank (TSX:BNS) adjusted its price target downward to $600, maintaining a Sector Perform rating, even as Intuit’s earnings surpassed expectations. This adjustment was influenced by a slower start to the tax season, although TurboTax’s strong unit sales and average revenue per user growth mitigated concerns. Stifel maintained a Buy rating with a $725 price target, highlighting Intuit’s resilience and potential for durable growth, particularly in its online services and Credit Karma segments.

BMO Capital Markets also revised its price target to $714 while reaffirming an Outperform rating, emphasizing the company’s solid execution in tax-related services and the potential for AI-driven efficiencies. Intuit’s Global Business Services Online Ecosystem saw a 21% growth, and Credit Karma reported a 36% increase, marking significant improvements from previous quarters. These developments underscore Intuit’s strong financial performance and strategic focus on leveraging AI and automation to enhance its offerings.

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