Morgan Stanley lifts Intuit stock rating to Overweight, target to $730

On Wednesday, Intuit shares received an upgrade from Morgan Stanley (NYSE:MS), with the investment firm raising the stock rating from Equalweight to Overweight. The new price target set by the firm is $730.00, indicating confidence in the company’s growth prospects. According to InvestingPro data, analyst targets for Intuit currently range from $530 to $800, with the company maintaining an impressive gross profit margin of 79.61%.

Morgan Stanley’s decision comes after a period of underperformance for Intuit stock, which fell 19% over the past three months and 49% over the last year, lagging behind the large-cap average. The stock is currently trading near its 52-week low, with a market capitalization of $155.65 billion. The firm believes that the market has fully accounted for the challenges Intuit faces in the Do-It-Yourself tax preparation market. In contrast, the strength of Intuit’s small business segment, which is expected to maintain a growth rate of over 20%, is seen as a significant positive factor. InvestingPro subscribers can access 15+ additional exclusive insights about Intuit’s financial health and growth prospects.

Analysts at Morgan Stanley have pointed to an improving demand environment and an enhanced product offering aimed at the up-market as key drivers for Intuit’s small business segment. These elements are expected to support sustained growth in this area of the company’s operations. Recent data shows the company achieved 12.48% revenue growth in the last twelve months, though it currently trades at a relatively high P/E ratio of 53.56.

The recent financial results for the second fiscal quarter of 2025 have also been cited as a demonstration of potential for upward revisions to earnings per share estimates and the stock price. Morgan Stanley suggests that the market’s concerns regarding Intuit’s tax segment are now reflected in the stock’s price, allowing investors to focus on the company’s potential for margin improvement and earnings growth.

Intuit’s performance in the small business domain, coupled with the potential for margin expansion, has tipped the balance in favor of a more optimistic outlook from Morgan Stanley. The upgraded rating and price target reflect the firm’s reassessment of Intuit’s future financial performance and market position.

In other recent news, Intuit Inc (NASDAQ:INTU). reported its second-quarter fiscal year 2025 earnings, which exceeded expectations. The company posted an earnings per share of $3.32, surpassing the forecasted $2.58, and achieved a revenue of $4 billion, beating the anticipated $3.83 billion. This strong performance was supported by a 17% year-over-year increase in revenue. Intuit also announced the launch of new AI-driven products designed to enhance customer experience. Analysts noted a positive market reaction following the earnings announcement, reflecting investor confidence in Intuit’s future prospects. Additionally, Intuit reiterated its full-year guidance, projecting a 12-13% growth in total company revenue and a 28-30% increase in GAAP operating income. The company continues to focus on expanding its AI-driven solutions and small business market, with significant growth observed in its QuickBooks and TurboTax platforms.

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