Intuit Inc. (INTU): A Bull Case Theory

We came across a bullish thesis on Intuit Inc. (INTU) on Librarian Capital’s Substack. In this article, we will summarize the bulls’ thesis on INTU. Intuit Inc. (INTU)'s share was trading at $757.22 as of 29^th May. INTU’s trailing and forward P/E were 61.81 and 33.78 respectively according to Yahoo Finance.

Intuit continues to demonstrate strong operating momentum, reaffirming its position as a high-quality compounder delivering double-digit revenue and earnings growth.

In its Q3 FY25 results, released May 22, the company reported accelerating growth across key platforms, particularly TurboTax and Credit Karma, underscoring management’s effective execution and diversification. Non-GAAP EPS growth is projected to reach 19% for FY25, with higher-value segments more than offsetting commoditization in legacy offerings.

Despite these positive trends, valuation remains the central risk: at $754.45, shares trade at roughly 44x FY25 Non-GAAP EPS and a steep ~100x FY24 free cash flow, once adjusted for share-based compensation. This reflects a current IRR in the high single digits (~7%), though longer-term returns are expected to gravitate toward mid-teens as growth compounds and valuation multiples potentially compress.

The market has responded positively, sending shares up over 14% since earnings and 25.7% in the past year. Notably, Fundsmith, a prominent quality-focused U.K. investment firm managing over £20 billion, recently re-initiated a small position in Intuit, after exiting in late 2022, highlighting renewed institutional confidence.

While the author maintains a Buy rating, as they have since 2019, they now frame the stock as best suited for long-term investors with a defensive tilt, given elevated multiples. Importantly, the author holds shares personally but has refrained from selling, partly due to large unrealized capital gains. With strong core business momentum, promising segment growth, and disciplined capital allocation,

Intuit remains an attractive, albeit richly priced, investment that rewards patient shareholders focused on quality and compounding.

Previously, we have covered Intuit Inc. (INTU) before their earnings release wherein we summarized a bullish thesis by Quality Equities on Substack. The author highlighted the company’s strong recurring revenue model, high-margin SaaS business, and dominant platforms like TurboTax and QuickBooks. The piece emphasized Intuit’s pricing power, strategic expansion into AI and fintech, and projected 20%+ earnings CAGR, positioning it as a rare long-term compounder despite a premium valuation. Since our previous coverage, the stock is up 15.3% as of 29^th May.

Intuit Inc. (INTU) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 87 hedge fund portfolios held INTU at the end of the first quarter which was 89 in the previous quarter. While we acknowledge the potential of INTU as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.