Intuit Inc
The results came amid an exciting earnings season. Here are some key analyst takeaways.
BofA Securities On Intuit
Analyst Brad Sills maintained a Buy rating while cutting the price target from $760 to $730.
"With the major tax quarter now behind Intuit, the company issued a disappointing FY24 outlook," Sills wrote in a note. The company projected 7%-8% consumer tax growth for fiscal 2024, while "we were expecting 9% to 10%," he added.
The lower projection was due to share losses at the "free filers and lower ASP filers," with the company focusing on market share gains in the "up-market CPA segment with TurboTax full service," the analyst stated. "We believe a focus on the higher value filing segment makes sense, though net share losses are concerning," he further wrote.
Stifel On Intuit
Analyst Brad Reback reiterated a Buy rating while reducing the price target from $720 to $690.
Intuit reported solid quarterly results with "9% TurboTax growth representing a healthy tax season," Reback said. He added, however, that the upside was lower than anticipated.
While the company lost market share, this was among non-paying and lower-paying customers, the analyst stated. Intuit gained "meaningful share in the higher-value-Assisted market with the company's Live business now expected to grow 17% Y/Y in FY24 (30% consumer revs)," he further wrote.
Piper Sandler On Intuit
Analyst Arvind Ramnani maintained an Overweight rating while raising the price target from $750 to $760.
Intuit's revenue grew by 11.9% to $6,737.0 million, beating the consensus of $6,647.7 million, Ramnani said. With a 55.1% margin, versus Street estimates of 53.0%, the company reported non-GAAP earnings of $9.88 per share, surpassing expectations of $9.38 per share, he added.
"The company raised FY24 guidance across the board," with revenue projections reflecting 13% year-on-year growth, versus previous guidance of +11%-12%, and the forecast for non-GAAP adjusted earnings being lifted to between $16.79 and $16.84 per share, from previous range of $16.17 to $16.47 per share, the analyst stated.
"TurboTax Live is expected to grow 17% in FY24, and as it scales and its GenAI capabilities advance, should improve the overall growth rate of the business," he further wrote.
Mizuho Securities On Intuit
Analyst Siti Panigrahi reaffirmed a Buy rating and price target of $725.
Investors were disappointed with Intuit's Consumer revenue guidance, which reflects around 8% year-on-year growth versus buy-side expectations of 10%, Panigrahi said.
Management indicated the loss of share in the DIY market comprised of free or lower-end customers, which represented higher customer acquisition costs and churn, "as the company focuses its efforts on higher value Assisted customers," he added.
"While Intuit's DIY share losses failed to dispel investor concerns over its longer-term growth prospects, we were encouraged by the strong traction with TurboTax Live Full Service this tax season, which should help it achieve 8-12% Y/Y longer-term Consumer growth by penetrating the $30B+ Assisted TAM," the analyst wrote.
JPMorgan On Intuit
Analyst Mark Murphy reiterated a Neutral rating and price target of $585.
Intuit posted a beat-and-raise quarter, "which has not been a common occurrence in this most recent software earnings cycle," Murphy said. While the quarterly results came in ahead of expectations across all segments, the macro commentary suggests a "stable, but still uncertain, environment," he added.
The upward revision in the company's revenue guidance is "primarily driven by QuickBooks performance," the analyst stated.
"Overall, we continue to see Intuit as continuing its pattern of consistent execution and innovation in the small business and consumer software markets," he further wrote.
BMO Capital Markets On Intuit
Analyst Daniel Jester maintained an Outperform rating and price target of $700.
TurboTax delivered revenue of around $3.65 billion, while its Live revenue growth projection of 17% is better than expected, Jester said.
"Paid units grew ~2% y/y while total units declined 1% as free and price sensitive filers have declined, a trend which was greater than we anticipated and expected to continue," the analyst wrote. "The updated FY24 guide slightly below 8% y/y may be disappointing for investors who anticipated favorable price, mix, and comps to drive results further into the company's long-term target range (8-12%)," he added.
INTU Price Action: Shares of Intuit declined by 7.81% to $610.54 at the time of publication on Friday.
