What’s Happening With Intuit Stock?

Intuit Inc. (NASDAQ:INTU) recently announced its Q2 fiscal 2025 results (fiscal year ends in July), exceeding analysts’ expectations for both revenue and earnings. It reported revenue of $3.96 billion and adjusted earnings per share of $3.32, compared to consensus estimates of $3.83 billion and $2.58, respectively. Increased demand for Intuit’s AI-powered tools contributed to the strong performance. The positive results led to a surge in INTU stock following the announcement.

However, despite this recent positive momentum, INTU stock, with a 10% decline since the start of 2024, has underperformed the S&P 500, which is up 28%. This underperformance is attributable to the company’s downbeat guidance provided in the previous quarter. If you want an upside with a smoother ride than an individual stock, consider the High-Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.

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Intuit’s revenue of $4.0 billion in Q2 reflected a 17% year-over-year increase. Performance across segments varied: Global Business Solutions Group saw strong growth of 21% to $2.9 billion, Credit Karma sales rose 36% to $511 million, Consumer Group sales increased 3% to $509 million, while ProTax Group revenue was down 1% to $272 million.

The company benefited from improved pricing and customer growth. Intuit’s adjusted operating margin expanded by 370 basis points year-over-year to 31.8% in Q2. This, combined with the higher revenue, resulted in earnings per share of $3.32, compared to $2.50 in the same quarter last year. Looking ahead, Intuit reaffirmed its full-year outlook, projecting revenue between $18.16 billion and $18.35 billion, and adjusted earnings per share in the range of $19.16 to $19.36.

Following the earnings announcement, INTU stock is trading up 8% in the pre-market. However, it’s important to note that INTU stock has exhibited significant volatility over the recent years, with annual returns considerably less consistent than the S&P 500. Returns for the stock were 70% in 2021, -39% in 2022, 62% in 2023, and 1% in 2024.

In contrast, the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, is considerably less volatile. And it has comfortably outperformed the S&P 500 over the last four-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.

Given the current uncertain macroeconomic environment around rate cuts and ongoing trade wars, could INTU face a similar situation as it did in 2022 and 2024 and underperform the S&P over the next 12 months — or will it see a strong jump? From a valuation perspective, we think INTU stock has ample room for growth.

Trading at approximately $600 pre-market, INTU stock currently has a price-to-sales ratio of 10.3x, slightly below its five-year average of 10.7x. Considering the company’s upbeat Q2 results, strong sales growth, and expanding margins, we believe a higher valuation multiple than the historical average is justified. Therefore, despite the recent price increase, we see further room for growth in INTU stock.

While INTU stock looks like it has some room for growth, it is helpful to see how Intuit’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons.

[1] Returns as of 2/26/2025
[2] Cumulative total returns since the end of 2016

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