INTU Stock Rises 18.3% Post Q2 Earnings: Should You Buy or Sell?

Intuit, Inc.’s INTU shares gained 18.3% since the earnings announcement through yesterday’s closing session. The company reported second-quarter fiscal 2026 results, with revenues and earnings per share (EPS) beating the Zacks Consensus Estimate.

The software leader behind TurboTax, QuickBooks, Credit Karma and Mailchimp has been a long-term winner in financial technology. The question now is whether this share price increase signals upside, suggests a period of holding or creates a selling opportunity. Let us delve deeper and find out.

What’s in Favor of INTU Stock?

The company posted solid second-quarter fiscal 2026 results, with revenues of $4.65 billion rising 17% year over year. The uptick implies continued demand across its small business and consumer ecosystems. Profitability strengthened as non-GAAP operating income grew 23% to $1.55 billion and non-GAAP EPS advanced 25% to $4.15. This performance underscores how its artificial intelligence (AI) and human intelligence (HI) platform innovation fuels the company’s growth and delivers significant customer benefits.

In the quarter, Global Business Solutions generated $3.2 billion in revenues, up 18% year over year, or 21% excluding Mailchimp, while Online Ecosystem revenues grew 21% or 25%, excluding Mailchimp. This growth is underpinned by sustained momentum in mid-market, with Online Ecosystem revenues for QBO Advanced and Intuit Enterprise Suite increasing 40%. The Consumer Group delivered a solid performance, with $1.5 billion in revenues, up 15% year over year, driven by Credit Karma revenue growth of 23%. ProTax revenues grew 7%. Although, overall IRS returns for this tax season were down more than 5 points through Feb. 6, the company delivered 12% TurboTax revenue growth in second-quarter fiscal 2026.

Intuit’s momentum is fueled by three big bets that represent the company's largest growth vectors across $300 billion in TAM, where its penetration is 6%. The first bet is delivering done-for-you experiences, powered by AI and HI, creating a category. The second is accelerating money benefits by putting money at the center of everything it does for its consumers and businesses. And third, fueling mid-market success with a disruptive AI-native ERP platform.

The company’s board approved a quarterly dividend of $1.20 per share, payable April 17, 2026. This represents a 15% increase per share from the same period last year. In the second quarter of fiscal 2026, the company repurchased $961 million in stock. Given the current stock price and strong confidence in the momentum of its business, the company is continuing to meaningfully increase its share repurchases this year.

What INTU Expects for FY26?

Intuit reiterated its fiscal 2026 guidance, projecting revenues between $20.997 billion and $21.186 billion, indicating 12-13% growth. the non-GAAP EPS is expected between $22.98 and $23.18, suggesting a 14% to 15% rally.

Intuit expects Global Business Solutions revenues to grow 14-15% for fiscal 2026. Within the Consumer segment, the company forecasts 8-9% revenue growth, with TurboTax growth expected to be 8%, Credit Karma is projected to rise 10-13%, and ProTax is anticipated to increase between 2% and 3%.

The company continues to focus on improving go-to-market and product experience. It now expects Mailchimp to return to double-digit growth sometime beyond fiscal 2026.

What Concerns Us About INTU?

Intuit’s business is seasonal in nature and typically generates stronger sales during the second and third quarters, which are characterized by the U.S. tax season. As a result, the company is exposed to significant risks if the seasons fail to deliver expected operating performance. In the first and fourth quarters, the company incurs losses, as revenues from the tax business remain at their lowest point during these periods.

INTU’s Stock Price Performance

Over the past month, INTU shares have outperformed the Zacks Computer – Software industry, the S&P 500 composite, and peers, such as Commvault Systems, Inc. CVLT and Autodesk, Inc. ADSK. Commvault Systemsshares have lost 1.2%, while Autodesk shares have gained 7% over the same time frame.

INTU’s Earnings Estimate Revision Trends Upward

The consensus estimate for Intuit’s fiscal 2026 sales calls for a year-over-year rise of 12.4%, while that for EPS suggests a 14.8% increase. EPS estimates have been trending upward by a cent to $23.14 per share over the past week.

INTU Shares Trade at a Discount

In terms of forward 12-month price/sales (P/S), Intuit is trading at 5.73X, which is at a discount to the industry average of 7.15X.

Final Take on INTU

Intuit remains one of the most compelling fintech platforms, with durable moats in tax, accounting and consumer finance. Its aggressive AI rollout, expanding mid-market presence and integrated consumer platform position it well for sustained growth. The company generates a solid cash flow, funds for buybacks and dividends, and has manageable debt.

Although business seasonality and macro risks temper the near-term upside, strong fundamentals, discounted valuation and rising earnings estimates create a clear buying opportunity.

Currently, Intuit carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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