J.P. Morgan Chase & Co. analyst Sterling Auty on Tuesday said Intuit Inc.’s
acquisition of marketing automation company Mailchimp may “raise eyebrows” because of the deal’s $12 billion price tag but it shows that the company “is not monkeying around” when it comes to growth. “We believe this is an excellent strategic move as it brings in a nicely profitable asset growing faster than the corporate average and further strengthens Intuit’s overall small business product portfolio,” Auty said in a note to clients. Intuit said the acquisition should be accretive to fiscal 2022 results. The acquisition price amounts to 13 times Mailchimp’s estimated 2021 revenue. Based in Atlanta, Mailchimp’s legal name is Rocket Science Group LLC.
Shares of Intuit rose 0.4% in pre-market trades on Tuesday. Reports surfaced earlier this month of the pending sale of Mailchimp for about $10 billion.