Core Insights - Intuit Inc. (NASDAQ:INTU) is considered one of the most oversold stocks on NASDAQ, with recent price target adjustments from BMO Capital and TD Cowen indicating a potential for recovery despite recent underperformance [1][2] Group 1: Price Target Adjustments - BMO Capital adjusted Intuit's price target to $624 from $810 while maintaining an Outperform rating [1] - TD Cowen revised its price target to $658 from $802, keeping a Buy rating, citing expectations of a clean earnings beat against a low bar due to recent stock underperformance [1] Group 2: Partnership Development - Intuit announced a multi-year partnership with Affirm on February 2, making Affirm the exclusive pay-over-time solution integrated into QuickBooks Payments [2] - This partnership aims to enhance Intuit's financial management capabilities, allowing small and mid-market businesses to offer flexible payment options, thereby maximizing sales and improving cash flow [2] Group 3: Business Segments - Intuit operates in several segments: Small Business and Self-Employed, Consumer, Credit Karma, and ProTax, providing a range of business and financial management solutions [3]

Core Viewpoint - The market is mispricing Intuit's role as a beneficiary of AI advancements, leading to a recommendation to buy its stock [1]. Group 1: Company Analysis - Intuit is transitioning from a tool provider to a more integrated service leveraging its proprietary data [1]. - The company is positioned to capitalize on emerging trends in AI, which could enhance its growth potential [1]. Group 2: Investment Strategy - The investment strategy focuses on identifying long-term compounding opportunities and future industry leaders [1]. - The approach is influenced by studies of renowned investors, emphasizing growth and durable business models [1].

Core Insights - Lindsell Train Ltd reported an equity portfolio valued at approximately $4.1–4.2 billion, maintaining a focus on a limited number of dominant consumer, media, and financial franchises [1][10] - The portfolio is highly concentrated, with the top 10 holdings accounting for over 90% of total assets, reflecting a belief in long-term brand power and cash generation [2][10] Portfolio Overview - Total Portfolio Value: ~$4.1–4.2 billion [2] - Top 10 Holdings: - TKO Group Holdings: ~$597 million (14.6%) - Alphabet (Class A): ~$543 million (13.3%) - Walt Disney: ~$427 million (10.5%) - Intuit: ~$418 million (10.3%) - Thermo Fisher Scientific: ~$397 million (9.7%) - Fair Isaac: ~$334 million (8.2%) - Mondelez International: ~$314 million (7.7%) - PepsiCo: ~$309 million (7.6%) - PayPal: ~$301 million (7.4%) - eBay: ~$223 million (5.5%) [2] Changes in Holdings - Notable Add: Alphabet (Class A) saw an increase of ~206,000 shares (+10.1% QoQ), reinforcing its role as a core long-term investment [3] - Major Trims: - TKO Group Holdings reduced by ~219,000 shares (-6.9% QoQ) - Walt Disney trimmed by ~361,000 shares (-8.8% QoQ) - Intuit reduced by ~54,000 shares (-8.1% QoQ) - Mondelez International trimmed by ~681,000 shares (-11.9% QoQ) - PepsiCo reduced by ~226,000 shares (-9.3% QoQ) - eBay reduced by ~830,000 shares (-25.3% QoQ) [8] Investment Strategy - The portfolio reflects a quality growth style focused on brand and intellectual property-led businesses, with a very long-term holding period and low turnover [9][10] - The strategy emphasizes disciplined capital allocation and patient ownership of high-return businesses, with modest rebalancing to enhance long-term compounding [11]

Group 1: Market Overview - The recent sell-off in software-as-a-service (SaaS) stocks has been severe, despite market indexes like the S&P 500 and Nasdaq Composite trading near all-time highs [1] - Investors are questioning whether the premium valuations of SaaS stocks are justified in the context of AI's disruptive impact [1][2] Group 2: Valuation and Investment Opportunities - Many SaaS stocks had frothy valuations leading into 2026, making a pullback in stock prices reasonable [2] - There are potentially oversold SaaS stocks that present buying opportunities, particularly Adobe and Intuit, which have seen their stocks decline by 26% and 39% year to date, respectively [3] Group 3: Adobe's Performance and Growth Prospects - Adobe's stock is considered undervalued with a price-to-earnings ratio of 16 and a forward price-to-earnings ratio of 11 [6] - The company reported a 10% year-over-year revenue growth in its fourth quarter, driven by the increasing importance of AI and the adoption of AI-driven tools [7] - Adobe aims for a 10.2% year-over-year increase in annual recurring revenue for fiscal 2026, with an earnings-per-share growth guidance of 7.8% [7]

Core Insights - Morgan Stanley analysts suggest that five software stocks could potentially double in value within the next 12 months if fears surrounding AI subsist and the stocks rebound to their fair value [1] Group 1: Market Overview - Software stocks have faced significant declines this year, with the iShares Expanded Tech-software Sector ETF (IGV) losing over 20% of its value since the beginning of the year, primarily driven by concerns regarding AI's impact on the industry [1] - Major companies like Intuit, ServiceNow, and Salesforce have seen substantial drops in their stock prices due to fears that AI-native startups will pressure profit margins and reduce corporate headcounts, limiting revenue growth [1] Group 2: Investment Opportunities - Morgan Stanley identifies that some software stocks are currently trading at more than a 50% discount to their fair value, creating potential buying opportunities for investors [1] - The five software stocks highlighted by Morgan Stanley include large caps Intuit and Salesforce, which have potential upsides of 101% and 109% respectively from their recent closing prices [1] - Mid-cap stocks such as ServiceTitan, CCC Intelligent Solutions, and Vertex are also expected to more than double in value according to the analysts [1] Group 3: Market Sentiment and Future Outlook - The uncertainty surrounding AI's development has led to volatility in the stock market, but historical trends show that investors have often rebounded from such concerns, driving stock prices higher [1] - Experts, including Nvidia's CEO, have expressed skepticism about the notion that AI will severely disrupt the software industry, suggesting that nimble software providers could leverage AI to their advantage [1] - The market for tech stocks is expected to remain turbulent as uncertainty continues to loom over the software sector, with Morgan Stanley indicating that disruption-related volatility is likely to persist [1]

Core Viewpoint - The software sector is experiencing significant declines due to fears that AI advancements will disrupt existing software companies, leading to a sell-off on Wall Street [1][2][6]. Group 1: Market Impact - ServiceNow (NOW) stock has decreased by over 22% since January 29, while Thomson Reuters (TRI) has fallen more than 26% as of Wednesday. Intuit (INTU) shares are down over 26%, and Snowflake (SNOW) has shed 18%. Salesforce (CRM) has dropped more than 20% [2]. - The release of new AI tools by Anthropic and OpenAI has intensified concerns that these companies will either create competing software or enable businesses to develop their own, posing a threat to traditional software firms [1][2]. Group 2: Analyst Perspectives - Some analysts believe the panic in the market is an overreaction, suggesting that AI will not replace existing software companies but rather enhance their services [3][4]. - William Blair analyst Jason Ader noted that the current market reaction resembles a "baby-with-the-bath-water" situation, indicating that not all software companies are equally at risk [4]. Group 3: AI Industry Developments - The AI industry has made significant advancements since the launch of ChatGPT in 2022, changing how tasks are performed but it is premature to declare AI companies as the new leaders in enterprise software [5]. - The uncertainty surrounding the potential impact of AI on the software industry has led to a broader sell-off, with investors seeking safer investments in sectors perceived as more stable [6][7].

Core Viewpoint - The article compares Salesforce.com (CRM) and Intuit (INTU) to determine which stock is a better option for value investors, highlighting CRM's stronger valuation metrics and Zacks Rank [1]. Group 1: Zacks Rank and Earnings Outlook - CRM has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook due to recent revisions in earnings estimates, while INTU has a Zacks Rank of 4 (Sell) [3]. - The Zacks Rank emphasizes stocks with improving earnings estimates, making CRM a more attractive option for investors [3]. Group 2: Valuation Metrics - CRM has a forward P/E ratio of 14.90, compared to INTU's forward P/E of 18.22, suggesting that CRM is undervalued relative to INTU [5]. - CRM's PEG ratio is 0.99, indicating a favorable valuation when considering expected EPS growth, while INTU's PEG ratio is 1.28 [5]. - CRM's P/B ratio is 3.02, significantly lower than INTU's P/B of 6.07, further supporting CRM's valuation as more attractive [6]. Group 3: Value Grades - CRM has a Value grade of B, while INTU has a Value grade of D, indicating that CRM is perceived as a better value investment [6].

Core Insights - Intuit Inc. is a leading financial software company known for products like TurboTax, QuickBooks, and Mint, serving individuals, small businesses, and accountants in tax preparation, accounting, and personal finance management [1] - BMO Capital has set a new price target for Intuit at $624, indicating a potential increase of 42.63% from the current stock price of $437.50, attributed to recent innovations in ecommerce tools by Intuit Mailchimp [2][6] - Intuit Mailchimp's new ecommerce tools utilize data, automation, and artificial intelligence to enhance marketing strategies, linking marketing campaigns directly to revenue generation [3][6] Stock Performance - Intuit's current stock price is $437.50, reflecting a decrease of $6.27 or approximately -1.41% today, with fluctuations between $431 and $441.16 [4] - Over the past year, Intuit's stock reached a peak of $813.70 and a trough of $411.11, with a market capitalization of around $121.8 billion [4] - Today's trading volume for Intuit is 3,716,493 shares, indicating active market participation despite the recent dip in stock price [5]

Group 1 - Intuit Inc. (NASDAQ:INTU) is identified as a potential undervalued stock, with a significant sell-off of over 45% from its high, currently trading at approximately 19 times this year's earnings estimates [1] - The company is recognized for its financial management, tax preparation, marketing, and personal finance solutions, including products like TurboTax and QuickBooks [3] - Despite the potential of Intuit as an investment, there are opinions suggesting that certain AI stocks may offer greater upside potential and carry less downside risk [3]

Core Viewpoint - Intuit (INTU) has faced significant valuation challenges, with analysts warning of substantial downside risks despite strong business performance. The company's stock has dropped nearly 50% due to market concerns that AI could disrupt its core business [2][3]. Group 1: Reasons for Stock Decline - The recent decline in Intuit's stock is attributed to market sentiment rather than fundamental performance, with valuation multiples compressing from approximately 30x to 19x, a reduction of over 50% [4]. - The sell-off aligns with a broader pullback in the software sector, reflecting a market perception that if software development costs approach zero, the value of Intuit's software business will significantly decrease [8]. Group 2: Business Resilience and Growth - Despite the stock decline, Intuit's business remains robust, with several segments showing accelerated growth. For FY24, total revenue is projected to be $16.285 billion, with a year-over-year growth rate of 13% [11]. - TurboTax, a key revenue driver, is expected to see growth despite AI advancements, as users trust its established solutions for maximizing tax returns and minimizing risks [9][20]. Group 3: Financial Performance and Valuation - Intuit's non-GAAP operating margin improved by 3.4 percentage points, and GAAP operating income nearly doubled, indicating strong operational performance [12]. - The current valuation of Intuit at $443 reflects a price-to-earnings ratio below 20x, which is 48% lower than its five-year average, suggesting a significant undervaluation [15]. - Analysts emphasize that the current valuation based on GAAP earnings guidance is only 28x, a critical metric for assessing the company's financial health [17].