Intuit trades at $367, a little over half the $694.29 high it set within the past year, after a tax season the company concedes fell short of its own expectations, and amid securities class actions alleging misstatements about the strength of its tax business. The company says it lost on price with the most price-sensitive do-it-yourself filers earning under $50,000 a year, a group inside a DIY category it sizes at $5 billion, or 12% of TurboTax's addressable market. Operating margin has risen in each of the last three years, from 21.6% to 23.9% to 25.7%, and to 27.5% on a trailing-twelve-month basis now. Intuit is reducing its full-time workforce by 17%, and the CFO has said the majority of the cost savings are expected to flow to the bottom line, alongside a commitment to annual earnings-per-share growth of at least the mid teens in the coming years. At 22.1 times trailing earnings, inside a ten-year range of 15.7 to 83.9, the price appears to give little credit for the earnings side.
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Thomson Reuters Corporation Common SharesIntuit IncIntuit lost on price with price-sensitive DIY filers, missing tax season expectations.
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