Citigroup’s Brent Thill this morning raised his rating on Intuit to a Buy from a Hold ahead of the coming tax season. Thill offers a four-part thesis for his upgrade:
- Attractive valuation with 18% upside to $36 price target; stock has been weak on concern about recent announcements of acquisitions.
- Expecting upcoming tax season strength for the company.
- Acquisition of Digital Insight, an online banking services company, and Electronic Clearing House, which dos payroll and payments, could improve revenue guidance from 8%-10% to 15%-plus growth in fiscal ‘07.
- Seasonal trade as stock has returned about 20% from Feb. to July over past 2 years.
Thill has a $36 price target on the stock.
This morning, the stock is up 62 cents at $31.20.
INTU 1-yr chart: