This company has been on a roll this year and hits all the metrics in the technology sector. Intuit Inc. (NASDAQ: INTU) loves income tax time as its TurboTax product is one of the most widely used, and sales are expected to be very solid once again this year. It is also well-known for the QuickBooks line of accounting software, which is used by firms big and small. Intuit announced earlier this year it is launching QuickBooks Online Self-Employed, a new product that makes it easy for the rapidly expanding population of freelancers and independent contractors to handle small business accounting. The company estimates 43% of workers will be self-employed by 2020.
Intuit has served small businesses and accountants with QuickBooks for more than 20 years. It was an early innovator in cloud accounting when it first launched QuickBooks Online in 2001. The company recently announced that QuickBooks Online has more than a million paying subscribers, cementing its market leadership as small businesses shift to the cloud.
Deutsche Bank noted in the report:
We attended Intuit’s third annual QuickBooks Connect user conference today at the San Jose Convention Center. With attendance at a record 5,000 (up from 4,000 attendees last year and 3,500 in 2014) and dozens of QBO partners in the exhibit hall (including Google this time), the conference appears to have evolved into a huge community event, complete with CEO Brad Smith sounding evangelical about the contributions of small business to the global economy and Intuit’s commitment to this segment. We come away more encouraged about Intuit’s prospects after several conversations with partners and customers in the ecosystem.
Investors are paid a 1.26% dividend, and the company will report its quarter next month. The Deutsche Bank price target is $130, and the consensus target is $114.81. The stock closed Wednesday at $107.82.
This company is off the radar, but Deutsche Bank expects strong third-quarter results Thursday after the close. Yandex N.V. (NASDAQ: YNDX) operates an internet search engine in Russia and internationally. It offers search, location-based, personalized and mobile services that enable users to find information, to communicate and connect over the internet from desktops and mobile devices; and it offers localized homepages for specific geographic markets.
The company also provides Yandex.News, a news aggregation and information service; maps and location-based services, such as Yandex.Maps, Yandex.Navigator and Yandex.Transport; Yandex.Mail, which provides users access to their email accounts; Yandex.Disk, a cloud-based storage service that allows users to upload, store, read and share files in various formats and sizes; and Yandex.Weather, which allows users to monitor weather conditions. The company also provides text-based advertising and display advertising services.
The report noted:
We expect strong third quarter results from Yandex and see revenue and EBITDA upside to our estimates, though margin flow-through may be more muted in the second half by heavy investment in Taxi including market expansion. While comps get more difficult in the fourth quarter, we see 2016 guidance as conservative and likely to move higher. We view 2017 Street estimates as achievable but note initial guidance (in Feb) will likely be conservative.
Deutsche Bank has a $27 price target. The consensus target is $23.06. The stock closed most recently at $18.95.
These four solid companies are all posting good earnings and appear to have excellent prospects going forward. While only suitable for accounts with high risk tolerance, they all make good addition now.