Evaluating Intuit After Its Big AI Push and Strong Multi Year Price Gains

• If you are wondering whether Intuit is still worth considering after its big run over the last few years, or if the easy money has already been made, you are not alone.
• The stock has inched up 2.1% over the last week and 1.0% over the past month, adding to a 76.4% gain over 3 years and 81.8% over 5 years, even though the 1 year return is slightly negative at -0.6%.
• Recent headlines have focused on Intuit doubling down on AI driven financial tools and expanding its ecosystem across QuickBooks, TurboTax, Mailchimp and Credit Karma. This reinforces the idea that it is becoming a must have platform for consumers and small businesses. At the same time, regulators and policymakers have kept Intuit in the spotlight around tax filing services and competition, which can shift how investors weigh its growth story against potential risks.
• On our framework, Intuit scores a 3/6 valuation check score. This suggests the market may be pricing in a lot of optimism but not full-blown euphoria. In the next sections we will break down what that means across different valuation methods before finishing with a more nuanced way to think about what Intuit is really worth.

Find out why Intuit's -0.6% return over the last year is lagging behind its peers.

Approach 1: Intuit Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth by projecting the cash it can generate in the future and discounting those cash flows back to today using a required rate of return.

For Intuit, the model starts with last twelve month free cash flow of about $6.3 billion and uses analyst forecasts for the next few years, then extends those trends further out. By 2030, free cash flow is projected to reach roughly $11.8 billion, with later years extrapolated by Simply Wall St as growth gradually slows, which is typical for a mature but still expanding software business.

Adding up all those discounted cash flows gives an estimated intrinsic value of about $765.87 per share. Compared with the current share price, this implies the stock is roughly 12.6% undervalued, which indicates that the market may not be fully recognizing Intuit’s long term cash generation potential.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Intuit is undervalued by 12.6%. Track this in your watchlist or portfolio, or discover 915 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Intuit.

Approach 2: Intuit Price vs Earnings

For a consistently profitable business like Intuit, the price to earnings ratio is a practical way to gauge what investors are willing to pay for each dollar of current profits. In general, faster growth and lower risk justify a higher PE multiple, while slower or more volatile earnings should command a lower one.

Intuit currently trades on a PE of about 45.2x, which is well above the broader Software industry average of roughly 32.7x and still below the peer group average of around 53.5x. That indicates the market may view Intuit as a higher quality, higher growth name than the typical software stock, but not the most aggressively priced in its peer set.

Simply Wall St also calculates a Fair Ratio of 40.6x, a proprietary estimate of what Intuit’s PE could be given its earnings growth outlook, margins, size, industry and risk profile. This is more nuanced than a simple peer or sector comparison because it adjusts for the specific characteristics that can influence what investors decide to pay. With the actual PE of 45.2x sitting moderately above the 40.6x Fair Ratio, the shares appear somewhat expensive on this metric.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1460 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Intuit Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which are simply the stories investors tell about a company that connect their view of its future revenue, earnings and margins to a specific fair value estimate. On Simply Wall St’s Community page, you can use Narratives to spell out your view of Intuit, link that story to a financial forecast, and instantly see the fair value that drops out, then compare it to the current share price to decide whether you think the stock is a buy, hold or sell. Because Narratives update dynamically when new information like earnings, product launches, or news about Intuit’s OpenAI partnership arrives, you can quickly see how your valuation might need to change. For example, one Intuit Narrative might lean bullish, assuming faster AI driven adoption, higher margins and a fair value closer to the most optimistic analyst target near $971. In contrast, a more cautious Narrative could focus on Credit Karma cyclicality and Mailchimp headwinds and land nearer the low end around $600, and both perspectives are visible, structured and comparable in one place.

Do you think there's more to the story for Intuit? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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