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Raising Intuit Fair Value Estimate on Growth Opportunities

Intuit maintains its wide moat thanks to subscription transition and connected products.


Julie Bhusal Sharma: We are raising our fair value estimate for wide-moat Intuit to $277 per share from $199 per share, leaving the stock fairly valued. We’ve raised our fair value estimate for Intuit after considering a lower cost of equity and the company’s potential for further operating leverage as we expect the company to continue to benefit from its transition to a subscription model.

We think Intuit will be able to yield a near 10% five-year compounded annual growth rate in revenues over the next five years, and expand operating margins by 10 points with help from both the accounting and the tax business.

Julie Bhusal Sharma does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.