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On Monday, Stifel maintained a Buy rating on Intapp, Inc (NASDAQ:INTA) shares and increased the price target to $60 from the previous $45. The adjustment reflects a revised outlook for the company's first-quarter performance and anticipates a shift in the timing of new cloud Annual Recurring Revenue (ARR).
The firm's analyst highlighted that the updated estimates now consider a greater portion of net new cloud ARR to be realized in the latter half of the year. Despite these adjustments, the projections for Intapp's full fiscal year 2025 remain consistent with prior expectations, including subscription and support revenue, total revenue, non-GAAP operating income, and Free Cash Flow (FCF).
Intapp's stock has experienced a significant surge, climbing more than 55% since the early August period before the company announced its fourth-quarter earnings. This uptick is attributed to the strong fourth-quarter results and growing confidence in Intapp's long-term market position and the potential for artificial intelligence to contribute to revenue growth in the future.
Stifel's stance is that the current strength in Intapp's share price not only reflects the solid fourth-quarter performance but also the market's increasing belief in the company's long-term prospects. The firm anticipates that Intapp will continue to see durable growth and margin improvements in the years ahead, which has led to the raised price target on the company's shares.
In other recent news, Intapp reported a substantial fiscal fourth quarter and year-end 2024 performance, with a 33% increase in cloud annual recurring revenue (ARR) to $297 million, accounting for 73% of the company's total ARR. This robust growth in the cloud business was complemented by a 21% increase in total revenue for the quarter, which reached $114 million. Additionally, the company added 73 accounts with ARR exceeding $1 million, marking a 38% year-over-year growth.
Intapp's SaaS and support revenue also saw a significant rise of 25% year-over-year, reaching $85 million. Looking ahead, the company projects SaaS revenue for fiscal year 2025 between $326.7 million and $330.7 million, underpinned by strategic partnerships, product innovation, and international expansion.
Despite slower growth in the professional services business and minimal expected revenue from AI offerings in fiscal year 2025, Intapp remains positive about its growth trajectory. The company's growth strategy, as discussed in its earnings call, emphasizes product innovation, strategic acquisitions, partnerships, and a focus on SaaS offerings, which are expected to generate over 90% of future revenue. The company's outlook is further bolstered by new client wins in various international markets and strong demand in the financial services sector.
InvestingPro Insights
As Intapp, Inc (NASDAQ:INTA) garners a positive outlook from Stifel with a heightened price target, InvestingPro data provides a deeper financial perspective on the company's current status. With a market capitalization of $3.66 billion, the company holds a significant position in its sector. The revenue growth figures are particularly notable, with a 22.7% increase over the last twelve months as of Q4 2024, and a quarterly revenue growth of 20.88% for Q4 2024. This growth trajectory reinforces Stifel's confidence in Intapp's market position and potential for future earnings.
InvestingPro Tips suggest that Intapp holds more cash than debt, which is a strong indicator of financial stability, and analysts expect net income to grow this year, aligning with the positive sentiment from Stifel. Additionally, the company's stock has been trading near its 52-week high, with a price 98.28% of that peak, reflecting investor optimism. For those interested in following Intapp's progress, there are 6 additional InvestingPro Tips available, offering further insights into the company's performance and market expectations.
While the P/E ratio stands at a negative figure of -110.69, indicating that the company is currently not profitable, analysts predict a turnaround with profitability expected within the year. This aligns with the company's strong return over the last three months, which has been 43.27%. Investors and analysts alike will be watching closely as Intapp approaches its next earnings date on November 5, 2024, to see if the company can sustain its growth and meet the optimistic projections set forth by market experts.
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