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Intuit (INTU) to Report Q4 Earnings: What's in the Cards?

Intuit Inc.INTU is set to release fourth-quarter 2017 earnings on Aug 22. Notably, the company has a positive record of earnings surprises in the trailing four quarters, with an average surprise of 24.3%.

Intuit reported stellar third-quarter fiscal 2017 results. The company reported adjusted income (including stock-based compensation but excluding amortization and other one-time items) from continuing operations of $3.71 per share, surpassing the Zacks Consensus Estimate of $3.67.

This tax-preparation related software maker posted revenues of $2.541 billion, which came within management's guided range of $2.50-$2.55 billion and surpassed the Zacks Consensus Estimate of $2.486 billion. On a year-over-year basis, revenues were up 10.3% mainly on the back of higher demand emanating from the U.S. tax season and better-than-expected growth in QuickBooks Online.

Let's see how things are shaping up for this announcement.

Factors to Consider

Intuit provides financial, accounting and tax preparation as well as software and related services for small businesses, consumers, and accounting professionals in the United States and internationally.

We are positive about the company's growing SMB exposure and believe that its strategic acquisitions will boost the segment. Increased adoption of its cloud-based services and products is another catalyst.

The company has also restructured business to focus on the QuickBooks services. It expects to continue investing in this portfolio, which might hurt its near-term profitability.

Stiff competition from payroll solution providers such as Paycom Software Inc. PAYC and Automatic Data Processing is a concern, especially considering the seasonality of Intuit's tax business and the ongoing economic uncertainty.

Intuit Inc. Price and EPS Surprise

Intuit Inc. Price and EPS Surprise | Intuit Inc. Quote

Earnings Whispers

Our proven model does not conclusively show that Intuit is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.

Zacks ESP: Intuit's ESP is 0.00% since both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 6 cents. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: Intuit carries a Zacks Rank #3, which increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of an earnings surprise.

We caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.

Stocks to Consider

Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter.

Broadcom Limited AVGO has an Earnings ESP of +2.57% and carries a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .

Vishay Intertechnology VSH has an Earnings ESP of +2.78% and carries a Zacks Rank #2.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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