Due to late tax legislation, budget and debt agreements, and
the 17-day government shutdown,
) has lowered its second-quarter 2014 guidance. The company now
expects a tax-revenue shift to the third quarter.
Intuit expects second-quarter revenues to range between $775
and $780 million (previous guidance $890-$910 million). Non-GAAP
earnings are expected in the range of 1 cent-2 cents (previous 25
Due to the shift in revenues, the third-quarter forecast will
now be higher than previous estimates. During the first-quarter
earnings release, Intuit projected third-quarter revenues of
$2.245 billion to $2.290 billion, with earnings of $3.25 to
$3.30, reflecting seasonally strong third-quarter guidance.
Despite the company's downward revision of its second-quarter
forecasts, Intuit reiterated the fiscal 2014 outlook. For fiscal
2014, the company expects revenues in the range of $4.440 to
$4.525 billion, representing 6.0% to 8.0% growth. The Zacks
Consensus Estimate for the period is pegged at $4.49 billion.
Non-GAAP operating income is projected at $1.58-$1.61 billion,
representing 7.0% to 10.0% growth. Non-GAAP earnings per share
are expected to be between $3.52 and $3.60, reflecting 10.0% to
13.0% growth, significantly higher than the Zacks Consensus
Estimate of $3.17 per share.
This is reflective of Intuit's growing small and mid-sized
business (SMB) exposure and the synergies from strategic
acquisitions. The higher adoption rate of its cloud-based
services and products is another positive factor. Moreover, the
company's accelerated share buyback program would aid the bottom
However, competition from leading payroll solution provider
Automatic Data Processing
) in the SMB arena, seasonality of Intuit's tax business and the
ongoing uncertainty in the economy concern us.
Currently, Intuit has a Zacks Rank #3 (Hold). Investors may
), which sports a Zacks Rank #1 (Strong Buy).
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