Intuit (NASDAQ:INTU) Shares Gap Down After Analyst Downgrade

Key Points

• Intuit shares gapped down after Morgan Stanley downgraded the stock from overweight to equal weight, cutting its price target sharply to $335 from $580. The stock opened at $280.06 after closing at $293.82 and last traded around $289.06.
• Several other analysts also trimmed their Intuit targets recently, though the broader Wall Street view remains positive with a consensus rating of Moderate Buy and an average price target of $468.84. Still, Weiss Ratings downgraded the stock to sell, showing sentiment is becoming more mixed.
• Despite the selloff, Intuit’s fundamentals remain solid: its latest earnings beat expectations, revenue rose 10.4% year over year, and the company recently paid a quarterly dividend of $1.20 per share. However, the article also highlights insider trading activity and ongoing legal headline risk tied to class-action claims.

Intuit Inc. (NASDAQ:INTU - Get Free Report) shares gapped down before the market opened on Tuesday after Morgan Stanley downgraded the stock from an overweight rating to an equal weight rating. The stock had previously closed at $293.82, but opened at $280.06. Morgan Stanley now has a $335.00 price target on the stock, down from their previous price target of $580.00. Intuit shares last traded at $289.0630, with a volume of 509,838 shares.

A number of other equities research analysts have also recently weighed in on the company. Northcoast Research reduced their price objective on Intuit from $575.00 to $465.00 and set a "buy" rating for the company in a research note on Thursday, May 21st. Oppenheimer reduced their target price on Intuit from $558.00 to $406.00 and set an "outperform" rating for the company in a report on Thursday, May 21st. Barclays decreased their price target on Intuit from $540.00 to $443.00 and set an "overweight" rating on the stock in a research note on Thursday, May 21st. Weiss Ratings downgraded Intuit from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Thursday, June 11th. Finally, Deutsche Bank Aktiengesellschaft decreased their target price on Intuit from $600.00 to $530.00 and set a "buy" rating on the stock in a research report on Thursday, May 21st. Twenty-one analysts have rated the stock with a Buy rating, eight have issued a Hold rating and three have issued a Sell rating to the company's stock. According to MarketBeat.com, Intuit currently has a consensus rating of "Moderate Buy" and an average price target of $468.84.

Insider Transactions at Intuit

In other news, Director Vasant M. Prabhu acquired 500 shares of the business's stock in a transaction dated Tuesday, May 26th. The stock was acquired at an average price of $309.71 per share, with a total value of $154,855.00. Following the completion of the transaction, the director directly owned 1,750 shares in the company, valued at approximately $541,992.50. This represents a 40.00% increase in their position. The acquisition was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, Director Richard L. Dalzell sold 284 shares of Intuit stock in a transaction on Tuesday, June 23rd. The shares were sold at an average price of $262.32, for a total value of $74,498.88. Following the completion of the sale, the director directly owned 11,758 shares of the company's stock, valued at approximately $3,084,358.56. This represents a 2.36% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders have sold 1,239 shares of company stock valued at $348,354. 2.49% of the stock is currently owned by company insiders.

Intuit News Roundup

Here are the key news stories impacting Intuit this week:

• Positive Sentiment: Some commentary remains supportive of Intuit’s long-term setup, with one recent article arguing the post-selloff decline may be an overreaction and another highlighting TurboTax Live’s strong performance as a potential offset to DIY tax business softness. Intuit's TurboTax Live Is Thriving: Can It Offset DIY Choppiness? L1 Capital International Sees Intuit’s (INTU) Decline as Market’s Overreaction
• Neutral Sentiment: Susquehanna lowered its price target on Intuit but kept a positive rating, suggesting analysts still see upside despite the recent weakness. Benzinga/The Fly coverage of Susquehanna price target change
• Negative Sentiment: Morgan Stanley’s cautious stance on the software group has dampened sentiment across the sector, including Intuit. Adobe, Salesforce and Intuit fall as Morgan Stanley begins cautious coverage
• Negative Sentiment: Multiple law firms are publicizing class-action deadlines and securities-fraud claims against Intuit over alleged misstatements about pricing and TurboTax competitive advantages, creating legal uncertainty and headline risk for shares. INTU Lawsuit Notice: Intuit Pricing Issues and 20% Stock Drop Trigger Securities Fraud Class Action INVESTOR DEADLINE: RGRD Law Announces that Intuit Inc. (INTU) Investors with Substantial Losses Have Opportunity to Lead Class Action Lawsuit

Institutional Trading of Intuit

A number of institutional investors have recently modified their holdings of the company. Rakuten Investment Management Inc. boosted its position in Intuit by 522.3% during the fourth quarter. Rakuten Investment Management Inc. now owns 51,697 shares of the software maker's stock worth $34,852,000 after purchasing an additional 43,389 shares during the period. Bank of New York Mellon Corp lifted its stake in shares of Intuit by 20.3% in the fourth quarter. Bank of New York Mellon Corp now owns 2,791,212 shares of the software maker's stock worth $1,848,954,000 after buying an additional 471,451 shares during the last quarter. Vestcor Inc lifted its stake in shares of Intuit by 79.1% in the fourth quarter. Vestcor Inc now owns 20,717 shares of the software maker's stock worth $13,723,000 after buying an additional 9,148 shares during the last quarter. Janney Montgomery Scott LLC boosted its holdings in shares of Intuit by 119.5% during the 1st quarter. Janney Montgomery Scott LLC now owns 86,618 shares of the software maker's stock worth $37,452,000 after buying an additional 47,148 shares during the period. Finally, O Shaughnessy Asset Management LLC boosted its holdings in shares of Intuit by 13.2% during the 4th quarter. O Shaughnessy Asset Management LLC now owns 59,974 shares of the software maker's stock worth $39,728,000 after buying an additional 6,999 shares during the period. Hedge funds and other institutional investors own 83.66% of the company's stock.

Intuit Stock Down 1.4%

The firm has a market capitalization of $79.24 billion, a price-to-earnings ratio of 17.54, a price-to-earnings-growth ratio of 1.07 and a beta of 1.00. The company has a debt-to-equity ratio of 0.26, a quick ratio of 1.45 and a current ratio of 1.45. The business's 50 day moving average is $301.21 and its 200-day moving average is $402.03.

Intuit (NASDAQ:INTU - Get Free Report) last released its earnings results on Wednesday, May 20th. The software maker reported $12.80 earnings per share for the quarter, topping analysts' consensus estimates of $12.57 by $0.23. The firm had revenue of $8.56 billion during the quarter, compared to analyst estimates of $8.54 billion. Intuit had a net margin of 21.91% and a return on equity of 25.18%. The business's revenue was up 10.4% on a year-over-year basis. During the same quarter in the previous year, the business earned $11.65 EPS. Intuit has set its Q4 2026 guidance at 3.560-3.620 EPS and its FY 2026 guidance at 23.800-23.850 EPS. Equities analysts anticipate that Intuit Inc. will post 18.18 EPS for the current fiscal year.

Intuit Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Friday, July 17th. Stockholders of record on Thursday, July 9th were issued a dividend of $1.20 per share. The ex-dividend date was Thursday, July 9th. This represents a $4.80 dividend on an annualized basis and a dividend yield of 1.7%. Intuit's payout ratio is 29.07%.

Intuit Company Profile

Intuit Inc NASDAQ: INTU is a financial software company headquartered in Mountain View, California, that develops and sells cloud-based financial management and compliance products for individuals, small businesses, self-employed workers and accounting professionals. Founded in 1983 by Scott Cook and Tom Proulx, the company has grown from desktop tax and accounting software into a diversified provider of online financial tools. As of my latest update, Sasan Goodarzi serves as Chief Executive Officer.

Intuit's product portfolio includes QuickBooks, its flagship accounting and business-management platform that offers bookkeeping, payroll, payments and invoicing capabilities; TurboTax, a tax-preparation and filing service aimed at individual taxpayers; and Mint, a consumer personal-finance and budgeting app.

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