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Analyzing Intuit’s Recent News and Financials

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Financial performance

Intuit’s (INTU) revenue rose at a four-year CAGR (compound annual growth rate) of 7% to $6 billion in fiscal 2018, which ended on July 31, 2018. The company’s net income improved at a four-year CAGR of 10% to $1.5 billion. Its revenue rose 15% in fiscal 2018.

The company’s Small Business & Self-Employed and Consumer segments generated 50% and 42% of its revenue, respectively, in fiscal 2018. Its Strategic Partner segment drove the rest of its revenue. Its net income improved 27% to $1.5 billion.

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How do the projections stack up?

The revenue projections for Inuit’s fiscal 2019, fiscal 2020, and fiscal 2021 are $6.6 billion, $7.3 billion, and $8 billion, respectively. The company’s expected net incomes for these years are $1.7 billion, $1.9 billion, and $2.2 billion, respectively. The stock has “strong buy,” “buy,” and “hold” recommendations from seven, three, and eight analysts, respectively. It has “sell” recommendations from one analyst. Its PE projections for fiscal 2019, fiscal 2020, and fiscal 2021 are 31.5x, 28x, and 24.8x, respectively.

At the end of last week, the stock had underperformed the NASDAQ Composite Index and the S&P 500 Application Software Index in the last five days and the last month. However, it had outperformed these indexes in the last three months and the last year. The stock closed at a 13% discount to its 52-week high and a 40% premium to its 52-week low at the end of the week.

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Some significant events

Intuit updated some of its Mint app’s features in August. Mint is a popular personal finance app with over 10 million active annual users. In September, the company announced the return of its QuickBooks Connect program for the fifth year. Intuit also launched a tax reform resource center in October to help tax professionals incorporate new tax reforms.

CEO succession

In August, Intuit disclosed that CEO Brad Smith would be departing at the end of December. Sasan Goodarzi, executive vice president and general manager of Intuit’s Small Business & Self-Employed Group, will succeed Smith as the company’s CEO on January 1, 2019.

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