Running Head: DISCUSSION BOARD FORUM 1
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Liberty University
BUSI 530
Discussion Board Forum 1 Thread
Standard & Poor’s NetAdvantage – Intuit
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Company Overview
Intuit (INTU), founded in 1983 is a provider of business and financial management
solutions. Most notably, financial management software and services. They have focused their
efforts on developing and marketing small business, tax preparation and personal finance
software. Intuit’s flagship products are QuickBooks, TurboTax and Quicken. As consumers
become more mobile and transaction storage media is transitioning to cloud based systems, Intuit
has positioned itself to change with the times. In 2014 they acquired Check as its mobile
billpaying platform was a great fit for Intuit. However, in 2016 with the declining use of home
based personal computers, Intuit sold its Quicken and Quickbase platforms to concentrate on
Tax, Planning and mobility options.
Industry Conditions
The application software areas of the market showed a 4.2% increase over the previous
year. However, this rate was dwarfed by the S&P 1500 rate of 10.6% for the same period (S&P
Capital IQ,” 2017). The market performance during 2015 was much better as it exceeded the
S&P 1500 by 20.8%. One possible reason for the reduction was due to the market fluctuation
brought on by the shift to cloud and mobile computing and world events such as Brexit and the
US Presidential election.
Financial Position
During the 2016 fiscal year 51% of Intuit’s revenue came from the Tax segment alone.
Intuit leads the Tax segment for the application software market. Additionally, Schiff & Szendi
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(2014) explain that QuickBooks small business financial management platform has 90% of the
US market share for small business accounting software. These markets are two thirds of the
entire Intuit portfolio.
Economic Outlook
The economic outlook for Intuit is very good as they have increased capital by divesting
parts of their business that were not directly related to their core competency. Additionally, they
respond quickly to market threats as evident in their mitigation of QuickBooks competitor Xero.
Instead of investing in the research and development of a new product the adapted QuickBooks
to an online format and attacked Xero through a previously established product line (“INTU Key
Statistics Intuit Inc. Stock,” 2017).
Investment Potential
Since Intuit has a proven ability to stay ahead of the market changes, consistently
delivering on its commitment to their stakeholders with dividends of $.25 -$.34 over the past
eight quarters and a historical five-year earnings growth of 5.04% investing in Intuit a good
choice (Cohan, 2016). Additionally, transitions of government in Europe and the United States
could affect tax laws as administrations make updates and changes. These changes could
confuse
the public and prompt them to utilize tax preparation software to develop their returns. TurboTax
as the market leader would capture most of this increased revenue.
References
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Cohan, P. (2016, April 12). Intuit Stock Soars As It Disrupts Clayton Christensen. Retrieved from
http://www.forbes.com/sites/petercohan/2016/04/11/intuit-stock-soars-as-it-disrupts-
clayton-christensen/2/#675b8ac5befa
INTU Key Statistics Intuit Inc. Stock - Yahoo Finance. (n.d.). Retrieved January 16, 2017, from
https://finance.yahoo.com/quote/INTU/key-statistics?p=INTU
S&P Capital IQ (2017, January 19). NetAdvantage. Retrieved on January 19, 2017 from
http://www.netadvantage.standardandpoors.com.ezproxy.liberty.edu/NASApp/NetAdvant
age/cp/companyOverView.do
Schiff, A., & Szendi, J. (2014). Helping small business entrepreneurs avoid critical mistakes in
QuickBooks accounting software. The Entrepreneurial Executive, 19, 169-181. Retrieved
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