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Chicago, IL – June 2, 2025 – Zacks Equity Research shares Intuit Inc. INTU as the Bull of the Day and Hyatt Hotels Corp. H as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Take-Two Interactive TTWO, Electronic Arts EA and Microsoft MSFT.
Here is a synopsis of all five stocks.
Intuit Inc. stock soared to all-time highs after the TurboTax owner posted a big beat-and-raise quarter on May 22, boosted by its expanding artificial intelligence efforts.
The technology giant finally broke out of the trading range it had been stuck in since late 2021. Wall Street is increasingly convinced that Intuit’s expanding portfolio and AI enhancements will help it keep churning out double-digit sales and earnings growth.
Intuit stock has crushed the Tech sector and software standouts such as Microsoft over the past 20 years.
The recent surge and breakout should put the mega-cap tech stock back on Wall Street’s radar for more near-term upside and continued long-term outperformance.
Intuit is one of the biggest players in a corner of the economy that’s never going out of style, because there are only two certainties in life: death and taxes. The company’s ability to consistently improve and expand its TurboTax software transformed INTU into a technology powerhouse.
The company’s essential, timeless software offerings have helped it post consistent top-line expansion that's impressive even among its mega-cap tech peers like Microsoft, Apple, and Alphabet.
INTU averaged 16% revenue growth over the last decade, alongside roughly 15% average GAAP earnings expansion.
Intuit expanded its software portfolio far beyond TurboTax to become a one-stop shop for business and consumer finance, email marketing, and more via Credit Karma, QuickBooks, and Mailchimp.
The tech standout boasts roughly 100 million customers across its various businesses. Most importantly, it’s ready to fight off any potential new-age challengers by going all in on artificial intelligence.
Intuit last summer cemented its AI efforts as it attempts to roll out the next-generation tech into every pocket of its business.
INTU said last July that would cut 1,800 jobs (10% of its workforce) and hire roughly 1,800 new people “primarily in engineering, product, and customer-facing roles” to pursue AI-driven expansion to make sure its ready to thrive in the AI-everything age.
Intuit posted beat-and-raise third quarter fiscal 2025 results (period ended on April 30) on May 22. Its revenue climbed 15% to help boost its adjusted earnings by 18% and improve its GAAP EPS by 19%.
Digging deeper, the firm expanded its Consumer Group revenue by 11%, Global Business Solutions Group sales by 19%, and Credit Karma revenue by 31%.
Intuit’s AI-powered TurboTax Live is an assisted tax preparation service that combines human experts with automation. The segment saw its revenue skyrocket 47% to $2 billion, representing 40% of total Consumer Group revenue.
The massive growth reflects rising consumer demand for hybrid tax solutions, where AI streamlines processes (data entry, calculations, and more) and human experts provide personalized guidance. The offering appeals to users looking for convenience over traditional in-person services offered by the likes of H&R Block and CPAs.
AI-powered innovations and personalized offerings spurred growth across the portfolio. “We're redefining what's possible with AI by becoming a one-stop shop of AI-agents and AI-enabled human experts to fuel the success of consumers and small and mid-market businesses,” CEO Sasan Goodarzi said in prepared remarks.
“We had an outstanding year in tax, including a significant acceleration in TurboTax Live revenue growth as we disrupt the assisted tax category.”
INTU is projected to boost its revenue by 15% in FY25 (up from its previous 12% guidance) and expand sales by 12% in FY26 to $20.96 billion.
The company is expected to boost its adjusted earnings by 18% in fiscal 2025, up from the 13% outlook before its recent release, and then post 14% growth next year.
INTU’s upbeat earnings outlook earns it a Zacks Rank #1 (Strong Buy), and it has topped our bottom-line estimates in 19 out of the past 20 quarters.
Intuit tanked in 2022 alongside the market and growth-heavy tech stocks as higher interest rates made its valuation levels harder to swallow. Wall Street was also worried about how AI might disrupt the tax industry.
INTU has flipped the narrative on the AI front, and Wall Street remains willing to pay a premium for Intuit because it's growing its earnings in a segment of the economy that’s never going out of style.
Intuit climbed over 3,300% in the past 20 years to more than quadruple Tech’s 725% and double Microsoft’s (MSFT) 1,600%. The huge outperformance includes its 80% surge in the past three years and 20% run in 2025, boosted by its post-earnings release surge.
Intuit finally broke out meaningfully above its 2021 highs after meeting resistance there throughout 2024.
The stock is looking a bit overheated in terms of RSI levels, as are a ton of stocks that have skyrocketed off the market’s April lows.
Intuit's strong earnings growth outlook helps it trade at a 40% discount to its highs with a 3.3 price/earnings to growth (PEG) ratio. This is worth stressing since INTU’s stock price just hit a new record.
Traders and long-term investors might want to wait for a pullback before they buy INTU stock.
But market timing is difficult, and there’s no telling when Intuit might fade since strong stocks that break out of a prolonged holding pattern tend to surge longer than many assume.
Hyatt Hotels Corp. stock has tumbled 16% in 2025 despite its recent rebound alongside the broader market.
Hyatt’s bottom-line outlook took a turn for the worse after it offered disappointing guidance on May 1.
The global hotel and hospitality icon’s earnings outlook has tanked over the last year as it faces a difficult-to-compete against stretch and a quickly changing macroeconomic backdrop.
Hyatt is a global hospitality powerhouse headquartered in Chicago, managing and franchising over 1,450 hotels and all-inclusive properties in 79 countries across six continents.
The company operates under tons of different brands, and it’s expanded through acquisitions, including its planned expansion into the Caribbean and Mexico via its planned purchase of Playa Hotels & Resorts N.V.
Hyatt has also gone full steam ahead on an asset-light business model. The strategy is to own fewer physical properties to focus on earning money by managing and franchising the hotels and resorts.
The company posted booming growth after its Covid downturn despite competition from Airbnb and others. That said, Hyatt is facing slowing growth against a difficult-to-compete stretch and a quickly changing macroeconomic backdrop.
Hyatt’s consensus fiscal 2025 earnings estimate has dropped from $2.59 a share to $2.00 since it reported its Q1 results on May 1, with its 2026 outlook sliding to $3.14 from $3.91. The recent downward earnings revisions have earned Hyatt a Zacks Rank #5 (Strong Sell).
Hyatt’s negative post-Q1 revisions are part of a longer-term trend that began in early 2024.
That said, the company’s long-term outlook likely remains intact, and H stock has crushed its Hotels and Motels segment over the past decade.
The question in the near term is should investors buy Hyatt even though its earnings outlook continues to tank.
The short answer is that investors and traders should likely stay away from the Hotel giant for now since there are plenty of other stocks and industries thriving amid the current economic environment.
Take-Two Interactive shares have surged 24% year to date (YTD), outperforming the Zacks Consumer Discretionary sector’s modest growth of 1%. TTWO’s competitors, Electronic Arts and Microsoft-owned Activision Blizzard, have returned 0.4%, 9.2% and 8.5%, respectively, YTD.
However, this rally represents a classic bull trap that savvy investors should avoid. The gaming giant's recent performance masks fundamental weaknesses that make it a clear sell candidate heading into 2025.
For fiscal 2026, the company expects GAAP net revenues between $5.95 billion and $6.05 billion. The company expects net bookings in the range of $5.9-$6 billion.
The Zacks Consensus Estimate for TTWO’s fiscal 2026 revenues is pegged at $5.99 billion, indicating growth of 6.1% on a year-over-year basis. The consensus mark for earnings is currently pegged at $3.58 per share, down 51.6% in the past 30 days.
Take-Two Interactive Software, Inc. price-consensus-chart | Take-Two Interactive Software, Inc. Quote
See the Zacks Earnings Calendar to stay ahead of market-making news.
The most damaging blow to Take-Two's investment thesis came with the announcement that Grand Theft Auto VI, originally slated for Fall 2025, has been pushed back to May 26, 2026. This delay effectively removes the company's biggest revenue driver from fiscal 2026, creating a massive hole in near-term earnings expectations. The postponement forces investors to wait an additional year for the franchise's primary monetization opportunity, severely undermining growth prospects.
The delay is particularly concerning given that GTA VI represents Take-Two's most significant growth catalyst. With management projecting only modest 5% year-over-year growth for fiscal 2026, the absence of this blockbuster title leaves little room for upside surprises and exposes the company's lack of compelling alternatives.
Take-Two's recent decision to raise more than $1 billion through public stock offerings reeks of financial desperation. The company priced 4.75 million shares at $225 each, with options for underwriters to purchase additional shares worth $150 million. This massive dilution comes at a time when the stock is trading near multi-year highs, suggesting management lacks confidence in maintaining current valuations.
The timing of this capital raise, coinciding with GTA VI's delay, indicates potential cash flow concerns that aren't immediately apparent in the company's optimistic guidance. Investors should question why a supposedly healthy company needs to dilute shareholders so aggressively.
Take-Two's fiscal 2025 results reveal troubling underlying trends. Operating expenses skyrocketed 44% to $4.6 billion, driven by a staggering $3.6 billion impairment charge related to goodwill and acquired intangible assets. This massive write-down suggests previous acquisitions, particularly the $12.7 billion Zynga purchase, have failed to deliver expected returns.
More concerning is management's projection that recurrent consumer spending will remain flat in fiscal 2026, with expected declines in mobile gaming and Grand Theft Auto Online revenues. These are the company's highest-margin business segments, and their deterioration signals structural challenges in maintaining profitability.
Take-Two's revenue concentration in a handful of aging franchises creates significant downside risk. The company expects roughly 45% of fiscal 2026 net bookings to come from Zynga's mobile titles, 39% from 2K properties, and only 16% from Rockstar Games. This heavy dependence on mobile gaming, which is experiencing declining revenues, exposes investors to sector-wide headwinds.
With limited new intellectual property in development and increasing competition from emerging gaming platforms, Take-Two lacks the diversification necessary to weather industry disruptions. The company's pipeline appears insufficient to offset declining performance from core franchises.
Take-Two's 24% year-to-date surge represents an unsustainable rally built on hype rather than fundamentals. Between GTA VI's delay, massive share dilution, deteriorating financial metrics, and over-reliance on declining revenue streams, the stock faces multiple headwinds that make it a clear sell. Investors should take profits now before the market recognizes these fundamental weaknesses and reprices the stock accordingly. Currently, TTWO carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
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