Intuit Inc Shares Scream Higher On Earnings Beat
Ticker.tv News | May 25, 2017 01:09AM ET
Intuit Inc. (NASDAQ: NASDAQ:INTU)
Intuit Inc., the behemoth in tax preparation and accounting software recorded their third-quarter earnings after the market closed on Tuesday May 23rd, 2017. Share’s screamed higher immediately once the numbers hit the news venues. The stock has been trading in a 52-week range from a low of $101.81 to a high of $130.10.
Shares closed the day at $129.15 which was up $1.99. However just after the earnings were announced, shares screamed up to the $141 area and closed at $140.92 or up $11.77 which is 9.11% .
Institutions own 87% of the shares, a huge amount which means the shares are closely held. The company pays a modest dividend of $0.34 per share which equals 1.05% annually. The company’s origination goes way back, well before the dotcom bubble of the 2000 era.
The company earns 95% of its revenues and earnings from business transactions that go on within the borders of the United States. This makes sense since it caters to predominantly U.S. citizens and Corporations who use their products each year for their tax preparation.The company began in 1983 in California.
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The products they produce that most people would recognize are TurboTax* and QuickBooks*. In 1991 Microsoft (NASDAQ:MSFT) decided they wanted to get into the business. So they came up with a product called Microsoft money. Although Microsoft money is very popular, it obviously did not deter Intuit from continuing on and staying very profitable.
The company Reported earnings of $3.90 per share, which beat most analyst’s estimates which had them coming in at $3.87 per share. Revenues jumped 10% coming in at about 2.5 billion dollars. The company also raised full-year guidance for their revenues which now stands at between 9 and 10% growth.
Brad Smith, Intuit’s chairman and chief executive officer offered up this during the conference call,
“This was another strong quarter for Intuit, with a hard-fought tax season delivering the revenue we promised along with continued momentum in our QuickBooks franchise,”
h3 INTU Charts/h3“Overall, we successfully delivered strong financial results. We entered the tax season with a clear plan to extend our lead in the do-it-yourself category and begin transforming the assisted category as well, embracing the power of the Intuit ecosystem. In small business, QuickBooks subscriber growth continued, driven by improvements across our platform for self-employed, small business and accountants,”.-BusinessWire
The above chart shows the monthly price action going back to before the year 2000. Note how it stayed in a sideways base for much of the 2002-2010 area and then began its upward ascent to where it is today.
The above price chart shows the daily price action going back to the beginning of 2017. The viewer can see the red resistance line and the green support line that has bound the company’s share price. However with today’s earnings and news announcement, shares will be gapping up huge in the morning for Wednesday’s trading. This is indicated by the green oval area in $140 area range.
The above chart shows both the five minute price action during the regular session in black, and the shaded area to the right showing the five minute price action after the earnings were released. Of note, on the right side is the huge green igniting five-minute candle bar which was created from all of the buyers who wanted in just after the earnings were announced.
Intuit Inc. is a provider of business and financial management solutions for small businesses, consumers and accounting professionals. The Company operates through three segments: Small Business, Consumer Tax and ProConnect.
The Small Business segment serves and advises small businesses and the accounting professionals, and includes QuickBooks financial and business management online services and desktop software, payroll solutions, and payment processing solutions. The Small Business segment also includes third-party applications that integrate with the Company’s offerings.
The Consumer Tax segment targets consumers and includes TurboTax products and services, which enable individuals to prepare and file their own federal and state personal income tax returns. The ProConnect segment targets professional accountants in the United States and Canada. Its ProConnect professional tax offerings include Lacerte, ProSeries, ProFile and ProConnect Tax Online.
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