Intuit (INTU) shares are down about 45% year to date, but up 45% from a 52-week low hit on June 2. The stock is around $370 now and higher on the day. Earnings come tomorrow after the close.
Jefferies Cut and the Setup
Jefferies lowered its price target on INTU to $500 from $550 while keeping a buy rating. At $370, that still points to upside, just less than before. About 55% of analysts covering INTU rate it buy or buy-equivalent.
The setup into earnings looks mixed. Expectations are low because of the 45% drop this year, but consensus estimates for fiscal 2027 look too high. Concerns about AI disruption remain, though the business is seen as more defensible than most think, which leaves room for shares to recover.
The Numbers Expected
INTU is expected to post earnings of $359 per share, up about 30% year over year. Revenue is seen at $4.27 billion, up 11.5% from the year-ago quarter.
Last quarter (fiscal third quarter), results beat, but guidance came in slightly below estimates. The stock fell 23% on that report. A beat alone is not enough for this name; guidance drives the move. There is talk that management may issue guidance conservatively and reset forward expectations. Most analysts view a reset as a net positive.
Where Other Firms Stand
- Piper Sandler: underweight, $250 target (about half the new Jefferies target), 76% accuracy rate.
- Deutsche Bank: buy maintained, target cut to $425, 67% accuracy rate, still sees upside.
- TD Cowen: hold, target raised to $328 from $304 last week, which sits below the current $370.
Average price target is about $446. The street low is $250 (Piper Sandler), the street high is $921, a wide range showing real debate. Investors are picking winners and losers across the software space.
An Options Trade Idea
For an aggressive, expensive play into the print, one setup is this week's expiration 420/320 strangle for about $4.20, with risk near 75%. The thinking: the stock could break out hard either way. Downside could reach 300 or lower; upside around 440.
The mixed Wall Street sentiment sets up a big move. The last earnings report was devastating, with the stock down over 80 points on the day, and that disappointment could repeat, sending it back toward where it came from. If results surprise and Wall Street turns bullish, there is good room above 400 to run toward the 200-day moving average. A risky play, but the payoff looks worth it.
Broader Market View
The market's negative reaction is a bit surprising. The Russell was expected to strengthen as more intervention enters the bond market, which should help small-cap and growth stocks. Financials are outperforming today. Some hyperscalers are holding the NASDAQ up while AI plays trade lower. A more risk-on stance looks likely going forward.
A lot hits this week: Nvidia (NVDA) earnings, Jackson Hole, and inflation data. NVDA has beaten and raised guidance for what looks like four straight quarters yet does not always rise on those results. If it guides just a bit above expectations, the stock could break the pattern and move up. Expect heavy volatility this week. The bond-buying intervention should be bullish for markets overall, though that has not shown up yet. NVDA may be more of a market-moving story than just a single-stock story.
