Intuit: Shares Halved Since November Despite Strong Q2 FY22 Results
(Substack Exclusive) Company Update (INTU US) (Buy)
Summary
Intuit shares have halved since their peak in November, and now trade at approx. 31x FY22 guided EPS. We believe this is a bargain.
Intuit is a platform business providing mission-critical software and services on subscriptions. EPS growth has been at double-digits.
Q2 FY22 results showed fundamentals in key segments remained strong; the reaffirmed FY22 outlook includes an 18-20% EPS growth.
Intuit has settled the Free File lawsuits with all 50 U.S. states at a small cost, and we expect a similar resolution with the FTC eventually.
With shares at $353.31, with EPS growth and a return to 38x P/E, we expect a 92% total return (23.9% annualized) by July 2025. Buy.
Introduction
We review our Intuit investment case ahead of Q3 FY22 results next Tuesday (May 24).
Intuit shares have halved since their peak in November 2021, though they have still gained more than 34% since our original initiation in September 2019:
Librarian Capital's Intuit Rating History vs. Share Price (Last 1 Year)
