Intuit (NASDAQ: $INTU) released stellar results on Thursday evening after markets closed. The financial software giant also raised guidance for the current financial year.
Intuit’s Fourth Quarter Results
The company reported revenue of $3.18 billion, beating estimates of $3.09 billion while earnings came in at $1.99, beating estimates of $1.85.
Revenue in the fourth quarter was up 17% YoY, driven by the Small Business and Self-Employed Group and Online Ecosystem segments, which saw revenue rise 20% and 18%, respectively. Meanwhile, EPS was up 21% YoY. For the full year, Intuit’s revenue rose 13% to $16.3 billion, while non-GAAP ESP rose 18% to $16.94.
Upbeat Guidance
For fiscal 2025, the TurboTax parent company forecasts revenue of $18.160 to $18.347 billion, a 12% to 13% YoY increase, while EPS is forecast at $19.16 to $19.36, a 13% to 14% increase. The forecast is above analysts’ forecast of $18.16 billion in revenue and $19.10 in earnings per share at the midpoint.
Intuit Stock Performance
In 2024, INTU stock has risen 10.19%, while over the past 12 months, the stock is up 32.83% to $665.29. In comparison, the S&P 500 is up 17.45% year to date, and 25.58% in the past 12 months.
The stock is currently trading above both the 50 and 200 DMA of $637.13 and $621.68. Its valuation is fair compared to other stocks in the Information Technology sector. It has a forward P/E of 34.84, which is close to Adobe’s (ADBE) of 27.10.
Analysts are optimistic about Intuit’s future, giving it a strong buy forecast. They forecast a broad range for the stock, with a high of $770 and a low of $585. The average forecast of $721.59 is an 8.46% upside based on the most recent closing price.
What Does The Future Hold For Intuit?
Intuit has performed slightly below the market in 2024. As such, investors need to ask what the future holds for them. Looking at its earnings results, there is no easy answer. While Intuit has exceeded expectations, this has not meaningfully impacted its stock price. The stock was up less than 1% in pre-market trading on Friday, August 23.
Most investors are likely waiting on the sidelines for Autodesk (ADSK), which is set to release its results on August 29, 2024.
One of its strengths is its dominant market position. TurboTax, one of its key products, holds a 73% market share. Its other product, QuickBooks, holds an 80% market share.
Another strongpoint for the company is that it has recently begun rolling out AI into its products. That is expected to streamline workflows, and automate most tasks. Consequently, it could make their products even more attractive.
There is still room for growth, and management is working on cross-selling other solutions, such as payroll management and payment processing.
Over the past five years, Intuit stock has grown 138.68%. Based on its current lucrative market position, it is likely that it could replicate that success in the coming five years.
Is Intuit A Buy?
Based on its forecast, recent results, and dominant market position, Intuit would potentially be a great addition to your portfolio. Investors should feel confident about owning a piece of this growth stock.
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