Is Intuit Still a Good Stock to Buy?

NASDAQ: INTU | Intuit Inc. News, Ratings, and Charts

INTU – The demand for Intuit’s (INTU) products and services is expected to increase with the rising importance of financial management in the digital realm. We think this, coupled with the company’s inorganic growth and profitability, should help the stock keep climbing to new highs. Let’s discuss.

The parent company of TurboTax, QuickBoots and Mint, Intuit Inc. (INTU) has gained 17.7% over the past three months. The stock closed yesterday’s trading session at $415.81. It is currently trading just 1.9% below its 52-week high of $423.74, which it hit on February 16, 2021.

The company’s impressive performance over the past few months has been largely driven by its acquisition of Credit Karma and an increased demand for the digitization of financial management services, such as accounting and tax preparation.

We think INTU should continue to thrive this year and beyond based on its increasing focus on being an artificial intelligence (AI)-driven expert platform.

Here is why I think INTU still has plenty of upside:

Acquisition of Credit Karma

The company’s acquisition of Credit Karma in December 2020 was one of the biggest fintech deals of 2020. The combined company is expected to create a new consumer finance platform that will make it simple for consumers to make better decisions with their money and take greater control of their financial lives. On February 11, Credit Karma integrated its checking account tool with INTU’s TurboTax in their  first joint project.

High Profitability

INTU’s gross profit margin of 83.1% is much higher than the industry average 47.9%. The company also has impressive ROE and ROA of 44.3% and 18.7%, respectively. In addition,  the company’s leverage free cash flow margin of 27.5% compares favorably with the industry average 11.8%.

Impressive Historical Growth

INTU’s  revenue increased at a CAGR of 13.9% over the past  three years. INTU’s EBITDA and EPS also increased at CAGRs of 15.6% and 24.7%, respectively, over the same period.

Impressive Analyst Estimates

Analysts expect the company’s revenue to increase 43.7% for the quarter ending April 30, 2021, 16.2% in fiscal 2021 and 15.5% in fiscal 2022. Its  EPS is expected to grow 42.5% for the quarter ending April 2021, 16.3% in fiscal 2022 and at a rate of 14% per annum over the next five years.

POWR Ratings Show Promise

INTU has an overall rating of B, which equates to Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors with each factor weighted to an optimal degree.

Our proprietary rating system also evaluates each stock based on eight different categories. In sync with the company’s high profitability, INTU has a Quality grade of A.

INTU has a Momentum grade of B. This is justified given the stock’s 37.1% returns over the past six months and 13.8% gains over the past month.

The stock has a B grade for Sentiment also, consistent with the favorable analyst estimates.

We have also given INTU grades for Growth, Value and Stability. Get all INTU’s ratings here.

Of 48 stocks in the B-rated Consumer Financial Services industry, INTU is ranked #5.

There are 10 other top-rated stocks in the same industry, Click here to access them.

Bottom Line

Based on its high profitability and continued product and service innovation with the help of AI, I think INTU still has plenty of upside.

Want More Great Investing Ideas?

“MUST OWN” Growth Stocks for 2021

How to Ride the 2021 Stock Market Bubble

7 Best ETFs for the NEXT Bull Market

5 WINNING Stocks Chart Patterns

 


INTU shares were trading at $413.88 per share on Thursday afternoon, down $1.93 (-0.46%). Year-to-date, INTU has gained 9.13%, versus a 4.03% rise in the benchmark S&P 500 index during the same period.


About the Author: Manisha Chatterjee


Since she was young, Manisha has had a strong interest in the stock market. She majored in Economics in college and has a passion for writing, which has led to her career as a research analyst. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
INTUGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

A Case of Stock Market Whiplash

Just when the stock market (SPY) was inches away from a record high at 4,000 it got saddled with 6 days of downward pressure. Why did this happen? Is the pain over? What happens next? Read on below for answers …

:  |  News, Ratings, and Charts

2 Renewable Energy Stocks to Add to Your Watchlist

The clean energy industry is witnessing an unprecedented rally, with governments worldwide investing heavily to reduce their nations’ carbon footprints. Companies including Hubbell (HUBB) and Hallador Energy (HNRG) have been capitalizing on this trend and have delivered solid returns over the past year. Driven by federal subsidies and a rising awareness-driven demand for clean energy products, we think both names should keep climbing in the upcoming months.

:  |  News, Ratings, and Charts

Why I Believe Gold Will Rally, and 3 Stocks That Stand to Benefit the Most

While treasuries and tech stocks bounced back, the rest of market continued its decline Friday. David Cohne sees inflation as a major risk for investors and believes that gold will start a new rally. This should benefit mining stocks such as Gold Corporation (GOLD), Newmont Corp. (NEM), and Kinross Gold Corporation (KGC).

:  |  News, Ratings, and Charts

Cybersecurity Industry in 2021: The Complete Investors Guide

The cybersecurity industry expects to see tremendous growth in the next decade. Therefore investors should consider adding McAfee Corp. (MCFE), Radware Ltd. (RDWR), Qualys Inc. (QLYS), Proofpoint Inc. (PFPT), and Norton Lifelock Inc. (NLOK) to their portfolios.

:  |  News, Ratings, and Charts

Why I Believe Gold Will Rally, and 3 Stocks That Stand to Benefit the Most

While treasuries and tech stocks bounced back, the rest of market continued its decline Friday. David Cohne sees inflation as a major risk for investors and believes that gold will start a new rally. This should benefit mining stocks such as Gold Corporation (GOLD), Newmont Corp. (NEM), and Kinross Gold Corporation (KGC).

Read More Stories

More Intuit Inc. (INTU) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All INTU News