Intuit Inc (NASDAQ:INTU) stock fell 3.95% (As on March 10, 11:27:09 AM UTC-4, Source: Google Finance) after Rothschild & Co Redburn upgraded the company to Buy from Neutral with a price target of $700, up from $670, indicating 46% upside from current levels. The company’s core QuickBooks and TurboTax applications are some of the “most resilient to AI disruption risk” in the enterprise software sector, the firm tells investors in a research note. The analyst pointed to deep data and business logic moats built on complex regulatory dependencies, deep domain knowledge and strong network effects.
Rothschild Redburn said these factors will continue to provide significant pricing power for Intuit. The firm projects 13% annual revenue growth for the company over the next five years. The upgrade gives Intuit 46% potential upside from current levels based on the new price target. Rothschild Redburn also forecasts 15% annual free cash flow growth over the coming five years. The timing appears opportune, as shares currently trade at $473.67, down 42% from their 52-week high of $813.70. The analyst views the regulatory complexity and domain expertise embedded in Intuit’s core products as protective advantages against emerging competitive threats. Redburn’s view comes as investors reassess enterprise software valuations amid concerns that new AI tools could disrupt traditional applications. The firm said valuations across the sector have fallen to historically low levels as markets attempt to price that risk. Analysts argued that while AI could create short-term pressure on pricing, many established software companies retain strong competitive advantages because of the data and business logic embedded in their systems. Redburn added that companies with unique data sets and complex operational logic are better positioned in what it called an emerging “intelligence layer” being built by frontier AI developers on top of existing enterprise software. Redburn said enterprise software companies could face near-term pressure as AI tools lower the cost of switching between vendors, but it believes share prices have already over-corrected for those risks.
In other recent news, Intuit Inc. reported strong second-quarter results for fiscal year 2026, surpassing analysts’ expectations. The company achieved a non-GAAP earnings per share of $4.15, exceeding the forecasted $3.68, and reported revenue of $4.65 billion, which was above the projected $4.53 billion. This performance was bolstered by a 17.4% year-over-year revenue increase and a 33.3% adjusted operating income margin. Despite these positive results, Intuit’s fiscal 2026 guidance remains unchanged, a typical stance until the conclusion of the tax season. The company demonstrated notable growth in its QuickBooks Online Accountant and International Email Service, with a 40% increase in customers year-over-year.