Intuit (INTU) Stock Plunges 11% as FY27 Forecast Disappoints Wall Street

Key Takeaways

• Intuit exceeded Q4 projections with earnings per share of $4.03 versus the $3.54 consensus and sales of $4.35B against $4.27B anticipated, yet shares plunged 11% in after-hours trading.
• Fiscal 2027 revenue growth outlook landed at 9-10%, a decline from FY26’s 14% and beneath Wall Street’s 12% projection.
• TurboTax expansion was forecast at merely 2-3%, significantly under the 6.8% analyst estimate, sparking worries about artificial intelligence-driven competition.
• Both JPMorgan and Bank of America moved INTU to Neutral ratings, with JPMorgan dramatically reducing its target from $605 down to $331.
• Optimistic analysts including Mizuho and Jefferies maintained Outperform positions, setting targets between $380 and $500.

Shares of Intuit tumbled approximately 11% in extended trading after the company released its fourth-quarter fiscal results, falling to $318 before recovering to around $339.75 during Wednesday’s session. The stock is presently down about 3.5% for the day.

Intuit Inc., INTU

The financial results were actually impressive. The company delivered Q4 earnings per share of $4.03 compared to projections of $3.54, representing a beat of almost 14%. Sales reached $4.35 billion, climbing 13.6% from the prior year and surpassing the $4.27 billion Street estimate.

However, the forward-looking projections triggered the selloff.

The company projected fiscal 2027 revenue in the range of $23.28 billion to $23.51 billion, suggesting expansion of 9% to 10%. This marks a deceleration from FY26’s 14% growth rate and misses the $23.72 billion Wall Street forecast.

The TurboTax projection particularly alarmed investors. Management forecast merely 2% to 3% growth for TurboTax, substantially beneath the 6.8% expectation from analysts. Additionally, the company reduced its long-range growth projection for its Global Business Solutions division to 10-15%, down from the previous 15-20% range.

The company blamed the diminished outlook on weakening Mailchimp performance, continued erosion in desktop offerings, and reduced average revenue per TurboTax user following pricing adjustments intended to attract a broader customer base.

Analysts Respond With Rating Cuts

JPMorgan moved INTU to Neutral from Overweight, slashing its target price to $331 from $605. Analyst Samik Chatterjee indicated that disruption threats have spread beyond TurboTax and are now affecting the QuickBooks-centered Global Business Solutions business. Chatterjee highlighted decelerating new user acquisition across both platforms and observed that management refused to provide a timeframe for returning to double-digit expansion.

Bank of America similarly downgraded the shares to Neutral from Buy, trimming its target to $360 from $400. Analyst Tal Liani suggested TurboTax seems to be surrendering market position to cheaper AI-powered competitors rather than successfully converting users to premium assisted services. BofA pointed out that online customer growth in the enterprise division increased only 3% year-over-year.

Both financial institutions anticipate FY27 will involve significant investment, with Intuit deploying aggressive pricing and promotional strategies to restore its customer growth trajectory. Such expenditures are projected to pressure profit margins in the coming quarters.

Optimistic Voices Maintain Support

Not all analysts turned bearish. Mizuho retained its Outperform rating with a $430 target, emphasizing FY27 profitability projections that exceeded Street expectations. Jefferies preserved its Buy rating with a $500 objective, reduced from $550, characterizing the guidance as “conservative.”

BMO Capital and Oppenheimer also maintained Outperform stances at $412 and $380 respectively. The aggregate consensus stands at 24 Buy, 9 Hold, and 2 Sell ratings.

Current Valuation Metrics

At present prices, INTU is valued at 13.1x forward earnings with an 8.8% free cash flow yield and 81% gross profit margins. A fair value calculation estimates the stock at $557.71, suggesting potential upside of approximately 64% from today’s levels.

Non-GAAP earnings per share guidance for fiscal 2027 arrived at $22.88 to $23.12, roughly 15-16% beneath the previous consensus of $27.30.

“Big bets” including mid-market offerings, assisted tax services, and money management solutions expanded 34% and currently account for 30% of overall revenue, though they remain insufficient to counterbalance the TurboTax deceleration.

The initial assessment of the revised guidance will occur with Q1 FY27 earnings scheduled for December 1.

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