Intuit: Strong Business Benefiting From Lower Interest Rate Outlook
(Preview) Company Update (INTU US) (Buy)
Summary
Intuit shares rose 9.5% in March, joining a rally among Technology stocks and likely benefiting from lower interest rate expectations.
At $445.83, relative to FY23 guidance, shares are now at approximately 32x Non-GAAP EPS and 63x GAAP EPS.
Our forecasts, which assume a 35x trailing P/E on exit, indicate a total return of 63% (16.5% annualized) by July 2026.
Operational performance was strong in H1 FY23, and full-year guidance was reiterated, including a 15-17% Non-GAAP EPS growth.
We like Intuit as a high-quality business with proven growth and resilience, and reiterate our Buy rating.
Introduction
We review our Buy rating on Intuit after the share price rose 9.5% during March, taking its year-to-date rise to 14.0%, though it remains 11.8% lower than a year ago.
We initiated our Buy rating on Intuit in September 2019. Shares have since gained 69% (including dividends) in the roughly 3.5 years since our initiation, including 9.5% since our last review in December, though the share pr…