Investigating Intuit's Standing In Software Industry Compared To Competitors

Amidst today's fast-paced and highly competitive business environment, it is crucial for investors and industry enthusiasts to conduct comprehensive company evaluations. In this article, we will delve into an extensive industry comparison, evaluating Intuit INTU in comparison to its major competitors within the Software industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in the industry.

Intuit Background

Intuit is a provider of small-business accounting software (QuickBooks), personal tax solutions (TurboTax), and professional tax offerings (Lacerte). Founded in the mid-1980s, Intuit controls the majority of U.S. market share for small-business accounting and DIY tax-filing software.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
Intuit Inc 61.94 8.46 10.27 0.51% $0.26 $2.0 12.34%
Adobe Inc 49.98 16.04 13.55 9.17% $1.99 $4.31 10.31%
Salesforce Inc 130.20 3.49 6.24 2.19% $2.42 $6.49 11.44%
SAP SE 84.11 3.52 4.65 8.41% $1.8 $5.41 4.84%
Synopsys Inc 72.43 12.31 13.56 5.7% $0.38 $1.18 19.2%
Cadence Design Systems Inc 75.12 22.89 17.62 7.56% $0.34 $0.88 13.88%
Roper Technologies Inc 44.60 3.11 9.02 2.21% $0.68 $1.07 16.81%
Autodesk Inc 51.13 36.53 8.58 21.11% $0.29 $1.22 8.73%
Ansys Inc 47.65 5.05 11.50 1.43% $0.13 $0.43 4.8%
Zoom Video Communications Inc 132.68 2.68 4.24 2.69% $0.2 $0.87 3.57%
PTC Inc 54.78 6.46 8.17 2.4% $0.15 $0.43 17.27%
Tyler Technologies Inc 97.67 5.73 8.43 1.8% $0.1 $0.22 7.59%
Bentley Systems Inc 104.82 23.56 14.60 7.75% $0.07 $0.23 10.61%
Dynatrace Inc 97.14 8.19 11.40 2.31% $0.05 $0.27 24.55%
AppLovin Corp 770.80 8.83 4.97 4.69% $0.27 $0.49 -3.36%
Manhattan Associates Inc 84.96 70.97 14.55 22.54% $0.05 $0.12 20.37%
Average 126.54 15.29 10.07 6.8% $0.59 $1.57 11.37%

Through a meticulous analysis of Intuit, we can observe the following trends:

  • At 61.94, the stock's Price to Earnings ratio is 0.49x less than the industry average, suggesting favorable growth potential.

  • The current Price to Book ratio of 8.46, which is 0.55x the industry average, is substantially lower than the industry average, indicating potential undervaluation.

  • With a relatively high Price to Sales ratio of 10.27, which is 1.02x the industry average, the stock might be considered overvalued based on sales performance.

  • The Return on Equity (ROE) of 0.51% is 6.29% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.

  • Compared to its industry, the company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $260 Million, which is 0.44x below the industry average, potentially indicating lower profitability or financial challenges.

  • The company has higher gross profit of $2.0 Billion, which indicates 1.27x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company is experiencing remarkable revenue growth, with a rate of 12.34%, outperforming the industry average of 11.37%.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

In terms of the Debt-to-Equity ratio, Intuit can be assessed by comparing it to its top 4 peers, resulting in the following observations:

  • Intuit demonstrates a stronger financial position compared to its top 4 peers in the sector.

  • With a lower debt-to-equity ratio of 0.39, the company relies less on debt financing and maintains a healthier balance between debt and equity, which can be viewed positively by investors.

Key Takeaways

Intuit's low PE and PB ratios suggest that the company's stock is undervalued compared to its peers in the software industry. However, its high PS ratio indicates that investors are willing to pay a premium for the company's revenue. Intuit's low ROE and EBITDA ratios suggest that the company's profitability and operational efficiency are relatively low compared to its peers. On the other hand, its high gross profit and revenue growth ratios indicate that the company is generating strong profits and experiencing significant growth in its revenue.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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