On Wednesday, Intuit Inc. (NASDAQ:INTU) maintained its Buy rating and a stock price target of $770, as confirmed by a Jefferies analyst. Intuit recently revealed a series of price increases for its QuickBooks products that will take effect in the first quarter of fiscal year 2025, which ends in October 2024. These price adjustments span nearly all QuickBooks product lines, including online versions, desktop software, and payroll services.
The analyst noted that these price changes could potentially lead to a higher initial revenue guidance for fiscal year 2025, surpassing the current market consensus of a 12.2% growth rate. There is also a possibility that the revenue growth could accelerate from the estimated 12.7% in fiscal year 2024. Intuit's business model, characterized by its sticky, recurring revenue, was highlighted as a strong point.
Despite Intuit's stock having declined by 5% year-to-date, which lags behind the S&P 500's 14% gain, the firm's outlook remains optimistic. The anticipated increase in revenue stemming from the QuickBooks price hike is expected to bolster the company's financial performance in the coming fiscal year.
The stock price target of $770 reflects the firm's confidence in Intuit's business strategy and market position. Intuit, known for its financial and accounting software products, continues to be a notable player in the software industry, providing tools and services that are essential for small and medium-sized businesses.
In other recent news, Intuit Inc. has been the center of several Wall Street firm analyses, reflecting an optimistic outlook for the company despite some short-term challenges. Intuit's product portfolio, including TurboTax, QuickBooks, and Credit Karma, has shown varied performance across segments.
TurboTax reported a 9.3% year-over-year revenue growth to approximately $3.65 billion, while the Small Business segment experienced an 18.1% year-over-year revenue boost to $2.39 billion. Meanwhile, Credit Karma surpassed expectations with an 8% year-over-year revenue increase to $443 million.
Analysts from firms such as BMO Capital Markets Corp., Barclays (LON:BARC) Capital Inc., KeyBanc Capital Markets, and Deutsche Bank (ETR:DBKGn) Securities Inc. have adjusted their financial models based on Intuit's recent performance, raising earnings per share (EPS) estimates for the fiscal years 2024 and 2025.
Still, BofA Securities and Susquehanna have adjusted their stock price targets for Intuit due to concerns about potential risks associated with the company's consumer tax business and a modest share loss in tax return units.
Despite these adjustments, firms like Edward Jones and Piper Sandler have maintained their positive ratings on the stock, highlighting Intuit's dominant market position, high customer retention rates, and the expected growth of TurboTax Live. These recent developments indicate a generally positive outlook for Intuit, with a recognition of some short-term challenges.
InvestingPro Insights
Intuit Inc. (NASDAQ:INTU) has demonstrated robust financial health and market position, with a series of metrics underscoring its performance and potential. With a sizable market capitalization of $165.35 billion and a substantial gross profit margin of nearly 79.49% for the last twelve months as of Q3 2024, Intuit's profitability is evident. Moreover, the company has shown a 12.39% revenue growth during the same period, which aligns with the analyst's expectations for an uptick in fiscal year 2025's revenue guidance.
An InvestingPro Tip points out Intuit's impressive track record of raising its dividend for 13 consecutive years, a testament to its financial stability and commitment to shareholder returns. Moreover, the company's dividend growth rate has been 15.38% over the last twelve months as of Q3 2024, further highlighting its shareholder-friendly policies.
While Intuit trades at a high earnings multiple with a P/E ratio of 53.97, this reflects the market's confidence in its future earnings potential. Investors considering Intuit's stock can find more valuable insights and additional InvestingPro Tips by visiting Investing.com's Intuit Pro page. There are over 15 additional tips available, which can be accessed with an exclusive 10% discount using the coupon code PRONEWS24 for a yearly or biyearly Pro and Pro+ subscription.
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