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On Monday, KeyBanc Capital Markets increased its price target for Intuit (NASDAQ:INTU) shares to $850 from the previous target of $770 while maintaining an Overweight rating. The adjustment comes after Intuit reported impressive third-quarter results, surpassing KeyBanc’s already optimistic projections. The stock, currently trading near its 52-week high of $734.18, has shown strong momentum with a 19.4% return over the past year. According to KeyBanc, Intuit’s top-line growth translated effectively into operating income and earnings per share (EPS). InvestingPro data shows 20 analysts have revised their earnings upward for the upcoming period, reflecting growing confidence in the company’s trajectory.
The financial software company’s third-quarter performance was bolstered by better-than-expected results from its Consumer Group (CG), notably TurboTax, and its Global Business Solutions Group (GBSG)/Credit Karma (CK). With impressive gross profit margins of 80.26% and revenue growth of 14.99% over the last twelve months, Intuit continues to demonstrate strong operational efficiency. Intuit’s TurboTax experienced robust growth, particularly from its TurboTax Live service, which is expected to more than double the top end of the long-term range by fiscal year 2025. The integration with the Credit Karma ecosystem also contributed positively, providing an approximate 100 basis point tailwind. For deeper insights into Intuit’s financial health (rated "GREAT" by InvestingPro), subscribers can access comprehensive analysis and over 15 additional ProTips.
Intuit’s GBSG segment saw continued strong performance, with QuickBooks Online (QBO) midmarket growth maintaining a rate of around 40%. This growth metric is considered highly significant by KeyBanc. Additionally, Intuit announced plans to introduce a suite of artificial intelligence agents and a new end-to-end platform within GBSG, which are anticipated to bring pricing advantages, although the specifics regarding timing and impact remain to be determined.
While the overall report was positive, KeyBanc noted that Mailchimp’s softer performance has been a drag on GBSG’s results. Nevertheless, the third-quarter outcomes highlighted the strength of Intuit’s platform and were a testament to the company’s strategic execution.
In light of the third-quarter performance and updated fiscal year 2025 guidance, KeyBanc has revised its estimates upward across the board, reflecting ongoing strength in Intuit’s core products and increased confidence in the company’s product direction and long-term guidance. The price target increase to $850 is based on these revised estimates and KeyBanc’s reinforced conviction in Intuit’s execution capabilities. KeyBanc reiterated its Overweight rating on Intuit shares, signaling its positive outlook on the stock.
In other recent news, Intuit has reported strong financial results for the third quarter of fiscal 2025, surpassing both earnings and revenue forecasts. The company achieved a non-GAAP earnings per share (EPS) of $11.65, exceeding the forecast of $10.9, while revenue reached $7.8 billion, above the expected $7.56 billion. Following these results, several financial firms have adjusted their price targets for Intuit. Piper Sandler raised its target to $825, maintaining an Overweight rating, while BMO Capital Markets increased its target to $820, citing Intuit’s strong financial performance and upward revision of its full-year guidance. RBC Capital and Jefferies both set their price targets at $850, maintaining positive ratings and highlighting Intuit’s consistent performance and AI-driven innovations. Intuit’s success is attributed to growth in its Consumer segment and Credit Karma business, with TurboTax Live expected to achieve significant customer growth. These developments reflect confidence in Intuit’s trajectory and market position, with analysts noting the potential for continued growth driven by AI enhancements and strategic initiatives.
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