Earnings season may be rolling toward an end, but some companies are still getting their moment in. Intuit, Inc. (INTU) just posted its Q2 earnings results on Tuesday, and pleasantly surprised bullish Wall Street analysts. The financial software firm beat consensus estimates on all segments, as well as raised its future outlook. (See Intuit stock charts on TipRanks)
Covering the stock and its move into the second half of 2021 is Matthew Pfau of William Blair & Company, who wrote that Intuit’s Credit Karma business generated record-breaking revenue, as well as expanded its membership to an all-time high.
Pfau reiterated his bullish Buy rating for the stock, but did not provide a price target. However, he did mention that double-digit revenue growth is expected for 2022.
The company did not sustain any significant damage from COVID-19 or its variants over the quarter, and Pfau noted that small businesses remained a quality sector. The four-star analyst stated that “payments saw an increase in both customers and average customer charge volume,” and that Intuit’s “online ecosystem revenue returned to management’s 30% target in the quarter.”
TurboTax Live was successful in increasing its customer base more than 100%, and its other tax service franchises saw high levels of customer inflows. INTU has made several productive investments to its platforms. For instance, it showed increased levels of transactions processed with the help of Lightbox, a platform for linking customers with appropriate products.
The strong ramp-up experienced by Intuit could, however, see a deceleration during 2022, according to Intuit’s management. Pfau noted that the “pent-up demand” could “taper and return to pre-COVID levels,” but he still expects the stock to outperform the market over the next twelve months.
On TipRanks, INTU has an analyst rating consensus of Strong Buy, based on 12 Buy ratings, and 1 Hold rating. The average Intuit price target is $614.55, reflecting a possible 12-month upside of 10.61%.
Disclosure: At the time of publication, Brock Ladenheim did not have a position in any of the securities mentioned in this article
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