Intapp Bucks Macro Headwinds Hitting Other Software Stocks

The software company's better-than-expected fiscal second-quarter earnings report last month has caused (INTA) stock to show strength by rocketing.

On Feb. 6, Intapp reported a profit, which was higher than what was forecasted. The Palo Alto, Calif.-based company earned an adjusted 3 cents a share on sales of $84.7 million in the quarter ended Dec. 31. This is compared to the analysts' poll by FactSet, which predicted a loss of 3 cents a share on sales of $80.5 million. In the year-earlier period, Intapp broke even on sales of $64.7 million.

Intapp provides cloud-based software applications that help private capital, investment banking, legal, accounting, and consulting firms meet client, investor and regulatory requirements.

"We're targeting the professional and financial services industry which is actually very large and overlooked, but underserved," said John Hall, Chief Executive. He added that Intapp's software "has been designed specifically for the unique operating and compliance needs of these firms."

The Microsoft alliance is helping to lift Intapp stock according to analysts. The software company's shares were up more than 4% in early trading Tuesday after KeyBanc Capital Markets initiated coverage of the stock with an overweight rating."We see a number of catalysts that could drive material upside to the shares over the next 12 to 18 months," KeyBanc analyst Brent Bracelin wrote in a note to clients.Analysts say the Microsoft alliance is helping to lift Intapp stock. The software company's shares were up more than 4% in early trading Tuesday after KeyBanc Capital Markets initiated coverage of the stock with an overweight rating."We see a number of catalysts that could drive material upside to the shares over the next 12 to 18 months," KeyBanc analyst Brent Bracelin wrote in a note to clients.

"Intapp is helping the financial deal-making, legal and advisory industry transition their operations to the internet cloud," Hall said.

Hall said the company has gotten a boost from its strategic partnership with software giant Microsoft (MSFT), which it announced in February 2022.

Intapp has reported sales and earnings growth for two consecutive quarters.

Intapp has predicted that it will break even on sales of $87.5 million for the current quarter, based on the midpoint of its outlook.

It is guiding to adjusted earnings of 4 cents a share on sales of $342.5 million for the full fiscal year. In its last fiscal year, it lost 12 cents a share on sales of $272 million.

The stock market hit a record high today after the release of strong earnings reports from several major corporations.After several major corporations released strong earnings reports, the stock market hit a record high today.

The stock of Intapp hit a record high of 42.11 on Wednesday before pulling back in a sell-off on Thursday. The company went public in June 2021, with its IPO priced at $26 a share.

Intapp's stock is on the IBD Tech Leaders list with an excellent IBD Composite Rating of 98 out of 99. Additionally, Intapp ranks first out of 39 stocks in IBD's Computer Software-Financial industry group, according to IBD Stock Checkup.

The company's strong performance has insulated it from macroeconomic headwinds.Despite macroeconomic headwinds, the company has still managed to perform well.

After the company's earnings news, Oppenheimer analyst Brian Schwartz reiterated his outperform rating on INTA stock.

"Intapp is a company that is taking advantage of the shift to cloud computing and digitizing workflows in various industries," Schwartz said in a note to clients. "It has developed a robust set of purpose-built solutions that can be used across multiple categories."

J. Parker Lane, analyst at Stifel, kept his buy rating on INTA stock after the company's quarterly report.

In a note to clients, Lane said that Intapp appears to be relatively insulated from the macroeconomic headwinds that are impacting other software stocks.

"Lane said that, unlike many software peers, the company stated that demand has remained strong across both professional and financial services, and there continue to be no signs of deal cycle elongation."

He added that they continue to believe the company's end markets provide a greater degree of stability in the face of a tougher macro, and the ongoing shift to the cloud provides a significant opportunity for new customer acquisition and on-premise migration.