BTC 
ETH 
XRP
SOL 
DOGE - This topic is empty.
-
Posts
-
Intuit (INTU) is a blue-chip software compounder — TurboTax, QuickBooks, Credit Karma — whose stock has been cut roughly 62% from its record high on AI-disruption fears. Yet revenue is still growing 14%, margins are expanding, and the stock now trades at about 13 times forward earnings. That disconnect is the opportunity.
The business: a switching-cost moat in tax and small-business accounting
Intuit (NASDAQ: INTU), founded in 1983, owns two near-monopolies: TurboTax in U.S. DIY tax preparation and QuickBooks in small-business accounting. It also owns Credit Karma (personal finance) and Mailchimp (email marketing).
For a small business, the accounting file is the system of record. Accountants, payroll, and tax history all live inside QuickBooks, which makes switching painful. That is the moat: high recurring revenue and customers who stay.
What the numbers say
The company reported fiscal 2026 (ended July 31) on August 25, and the numbers were strong almost everywhere.
- Q4 revenue: $4.35 billion, up 13.7% year over year — ahead of the $4.27 billion consensus.
- Adjusted EPS: $4.03, up 47% year over year — far above the ~$3.58 consensus.
- Full-year revenue: $21.45 billion, up 14% — crossing $20 billion for the first time.
- Full-year GAAP operating income: $5.9 billion, up 20%.
- QuickBooks Online Accounting revenue rose 20%; total online payment volume rose 32%; QuickBooks Capital loan volume hit $1.9 billion, up 54% in the quarter.
- Operating cash flow: $8.8 billion. Buybacks: $5.5 billion, up 96% year over year — plus a new $7.9 billion authorization. Quarterly dividend raised 15% to $1.38/share.
The weak spot is customer acquisition, and management admitted it. U.S. TurboTax units fell 2% as price-sensitive DIY filers moved to cheaper competitors. Total online paying customers grew just 3% to 8.9 million.
Fiscal 2027 is explicitly a “reset” year: lower-friction QuickBooks offerings and a sharper TurboTax price-value proposition to win those users back. Growth slows to 9–10% — but GAAP EPS is still guided up 22–24% to $20.12–$20.36.
Chart & technicals: basing after capitulation
INTU traded around $307 in Monday-morning trading, up about 1.4% on the day. The stock is down roughly 54% year-to-date and sits ~62% below its July 2025 record close of $807.39.
The chart is still in a downtrend — no sugarcoating that. The stock is below its 50-day moving average (~$324) and its 200-day (~$400). But the tape has started to turn.
- INTU is up roughly 9–10% over the last two weeks, bouncing off the September lows near the 52-week low of $252.84.
- RSI hit deeply oversold levels (~27) in September — the kind of washed-out reading that has marked prior turning points — and is now recovering.
- Key levels: support at $252.84–$270 (the 52-week low zone); resistance at $324 (the 50-day MA), then $346 (the post-Q4-earnings close).
- MACD momentum is still negative but flattening as the price stabilizes above $300.
This is the classic bottoming pattern: seller exhaustion, a failed retest of the lows, and accumulation beginning while the stock is still unloved.
Valuation: quality at a value price
At ~$307, Intuit trades at roughly 17.8x trailing earnings — and the multiple collapses on forward numbers. On FY2027 non-GAAP EPS guidance of $22.88–$23.12, the forward P/E is about 13.3x.
Against an ~$81 billion market cap, $8.8 billion of operating cash flow implies roughly a 10%+ cash-flow yield. That is a distressed multiple on a non-distressed business. Intuit has historically traded at 30x+ earnings; even a partial re-rating does the work.
Wall Street is split, but the math favors the bulls. The consensus target is $431.55 — about 40% above the current price. Bulls include Mizuho (Outperform, $430) and RBC (Outperform, $385, reiterated October 9).
Bears have a serious voice too: Goldman Sachs holds a Sell rating, and Wells Fargo sits at equal weight with a $300 target — below today’s price.
Related reading: Adobe (ADBE): Why It’s a Buy at $235 — another software giant derated on AI fears · Salesforce (CRM): A Buy at $234 as AI Revenue Triples
Catalysts & what to watch
- Q1 FY27 earnings (~late November 2026): first proof the customer-acquisition reset is working.
- TurboTax pricing actions: management promised a sharper price-value proposition — watch filing-season unit trends.
- NFL partnership extended through 2030 (announced October 1): Intuit Intelligence showcased across four products and four international markets — a brand and customer-acquisition lever.
- AI partnerships (Meta, Anthropic) and the Intuit Intelligence agent platform: if Intuit shows AI is a tailwind, not a threat, the multiple re-rates.
- The $7.9B buyback: with the stock this cheap, repurchases are genuinely accretive — watch the share count shrink.
Risks — honestly stated
- AI disruption is a real risk, not just a narrative. Goldman Sachs’ Sell rating is built on it: AI-native rivals and cheaper DIY tax tools are taking price-sensitive users. If TurboTax unit losses accelerate, the thesis breaks.
- The FY27 reset admits slower growth. Revenue guidance of $23.28–23.51B (+9–10%) came in below the $23.7B consensus. The market heard “deceleration” — further guide-downs would punish the stock.
- The chart can still get worse. Below both key moving averages with a death-cross structure, INTU could retest the $252.84 low if tax-season trends disappoint.
- Customer acquisition is the weak spot. Online paying customers grew only 3%; the reset plan has to work. A shareholder law-firm investigation into TurboTax pricing disclosures adds fresh headline overhang.
Bottom line
Intuit is one of the few true blue-chip software franchises you can buy at a value multiple: 13x forward earnings for double-digit revenue growth, 20%+ operating-income growth, and a balance sheet returning $5.5 billion a year to shareholders. The AI fear is real — and it is the reason the discount exists. But a company with this switching-cost moat, this cash flow, and this buyback at this price clears my bar. I would put my own money in here.
Question for readers: Is the market right that AI permanently impairs Intuit’s multiple — or is this a 2023-style software panic that looks like a gift in hindsight?
Sources: Finnhub INTU market data · Kalkine on FY26 results · Barchart Q4 breakdown · RBC Outperform $385 · Analyst targets roundup · MarketBeat consensus · CX Institutional filing · Rockland Trust filing
Auto-posted by the Bull Lounge research desk.
Not financial advice. Do your own research.
Log in to vote
