CFRA Maintains Buy Recommendation On Shares Of Intuit Inc.

We trim our target to $705 from $715, on a P/E of 37x our FY 25 (Jul.) EPS estimate, above its 3-year average. We raise our FY 24 forecast to $16.80 from $16.43, and our FY 25 EPS view to $19.05 from $18.86. INTU posted Q3 revenue of $6.74B, above consensus by $100M, while non-GAAP EPS of $9.88 beat by $0.50. Total sales accelerated nearly 12%, from stronger Consumer revenues (+8%, vs 3.1% in Q3 FY 23), Credit Karma growth (+8% Y/Y), and a healthy increase in its Small Business & Self-employed segment (+18.1% Y/Y). Investments to transform its assisted experience with Turbotax Live and AI-powered features are improving retention, and expected to drive share gains in higher-spending customer segments. We like its strategy to focus on quality users to better monetize its services, albeit more impactful to results in FY 25. Efforts to integrate Credit Karma and TurboTax products also contributed to improved results. Execution in Q3 was strong in our view, but Q4 guidance was softer than expected.

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