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On Wednesday, BofA Securities adjusted its outlook on Intapp, Inc (NASDAQ: INTA), a leading provider of business applications for professional and financial services firms. The firm lowered the price target to $48 from $52 while sustaining a Buy rating on the stock.
Intapp concluded its fiscal year 2024 on a strong note, with total revenue and non-GAAP operating income surpassing both BofA Securities' and the Street's estimates. The company has issued its initial revenue guidance for fiscal year 2025, which aligns with the Street's expectations, albeit slightly below BofA Securities' projections. However, its non-GAAP operating income forecast is ahead of both.
The company also introduced a new guidance metric, projecting 26-28% year-over-year growth for its SaaS revenue in 2024. This is indicative of the success of Intapp's SaaS-focused go-to-market strategy, as SaaS revenue is anticipated to constitute approximately two-thirds of the total revenue in FY25, an increase from 60% in FY24.
The positive results reinforce BofA Securities' long-term perspective that Intapp is gaining market share within the $9 billion addressable market for vertical software in the professional and financial services sector, which is currently only 6% penetrated. Despite the reduction in the price target, the firm's reiteration of a Buy rating suggests confidence in Intapp's future performance and market position.
In other recent news, Intapp has demonstrated strong financial performance, surpassing consensus estimates in its fourth-quarter fiscal year 2024 results. The company's total Annual Recurring Revenue (ARR) marked a 22% year-over-year increase at $404.2 million, with Cloud ARR noting a significant rise of 33%.
Furthermore, Intapp announced strategic acquisitions, including Transform Data International (TDI), and unveiled new generative AI capabilities. The company's software was also chosen by Argonaut Private Equity for automating the oversight of personal trading activities, emphasizing Intapp's commitment to leveraging technology for professional service firms.
However, recent analyst notes reveal a mixed outlook for the company. While Citi and Stifel maintained their Buy rating on Intapp, citing solid results and new generative AI capabilities, respectively, Oppenheimer downgraded Intapp's stock from Outperform to Perform due to concerns over increased competition and challenges within the AI industry.
These developments provide insights into Intapp's recent performance and prospects.
InvestingPro Insights
Intapp, Inc (NASDAQ: INTA) has demonstrated resilience in its recent financial performance, and while BofA Securities has adjusted its price target, there are several InvestingPro Tips and Data metrics that provide additional context for investors considering Intapp's stock. Notably, Intapp holds more cash than debt on its balance sheet, which could be a sign of financial stability. Additionally, 10 analysts have revised their earnings upwards for the upcoming period, indicating potential optimism about the company's future profitability. Despite not being profitable over the last twelve months, analysts predict the company will be profitable this year.
From a data standpoint, Intapp has a market cap of approximately $2.5 billion and has experienced a significant revenue growth of 23.81% over the last twelve months as of Q3 2024. The company's gross profit margin stands at an impressive 69.87%, although it’s operating at a loss with an operating income margin of -10.81%. Despite recent volatility, Intapp's stock has seen a significant return over the last week, with a 7.8% price total return.
For investors looking for more comprehensive analysis, there are additional InvestingPro Tips available on InvestingPro's platform (https://www.investing.com/pro/INTA). These insights could prove invaluable for making informed decisions about Intapp's stock, especially in light of BofA Securities' updated outlook.
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