Intuit’s Mixed Q3 Results and Weaker Q4 Outlook Impact Stock Performance

Top Analyst Ratings for May 24th, 2024

Financial management solutions provider Intuit (INTU:NSD) experienced a 4.8% decline in its stock during extended trading following the release of mixed results for Q3FY23. Although the company reported adjusted earnings of $8.92 per INTU stock share, marking a 17% year-over-year growth and surpassing analyst estimates of $8.49 per share, sales grew by 7% year-over-year to $6.02 billion, falling slightly short of the consensus of $6.09 billion.

INTU Stock-Future Outlook:

Looking at the outlook, Intuit raised its revenue projection for FY23, anticipating an annual increase between 12% and 13%, with a range of $14.279 billion to $14.317 billion. Moreover, the company expects adjusted profits for FY23 to be in the range of $14.20 to $14.25 per share, compared to the average consensus estimate of $13.83 per share.

However, Intuit’s guidance for the fourth quarter fell below expectations. Adjusted earnings are projected to be between $1.43 and $1.48 per share, while the consensus was $1.50 per share.

Additionally, Q4 sales are expected to grow by 9% to 10%. Intuit highlighted that the Consumer Group’s sales in Q4 will be affected by a decline in tax filings. Furthermore, the performance of Credit Karma, which provides home loans, auto loans, and other services, is being jeopardized by macro factors such as higher interest rates and inflation.

INTU Stock-Analyst Projections:

Looking at the future of Intuit stock, Citi analyst Steve Enders maintained a Buy rating with a price target of $475, indicating a potential upside of 5.6%. Enders remains confident in Intuit’s ability to generate free cash flow, which contributes to assigning a premium to the stock compared to its peers.

According to Stock Target Advisor, Intuit stock holds a Strong Buy consensus analyst rating based on 14 Buy ratings and two Hold ratings. The average price target for Intuit is $472.63, implying a potential upside of 5% from the current levels. So far this year, INTU stock has gained 15.4%.

INTU Ratings by Stock Target Advisor

The Takeaway:

As investors evaluate the mixed Q3 results and the weaker Q4 outlook, it is essential to consider the analysis provided by experts and the overall market sentiment. Intuit’s ability to generate cash flow and its long-term growth prospects should be carefully weighed before making investment decisions related to Intuit stock.

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