Intuit ( INTU Quick Quote INTU - Free Report) is likely to beat expectations when it reports first-quarter fiscal 2023 results after market close on Nov 29. In the last reported quarter, the company delivered an earnings surprise of 57.7%.
The company’s earnings surpassed estimates thrice in the trailing four quarters while missing the same on one occasion, the average being 13.8%.
For the fiscal first quarter, Intuit projects revenues to grow year over year in the 23-25% range. The Zacks Consensus Estimate for revenues is pegged at $2.50 billion, indicating year-over-year growth of 24.4%.
On a non-GAAP basis, Intuit anticipates reporting earnings per share in the range of $1.14-$1.20. The consensus mark for earnings stands at $1.17 per share, suggesting a year-over-year decline of 23.5%.
Intuit Inc. Price and EPS Surprise
Key Factors Ahead Q1 Earnings
The gradual recovery in Small Business and Self-Employed might have contributed to the top line during the quarter under review. The Zacks Consensus Estimate for Small Business’ revenues in the quarter stands at $1.86 billion.
Intuit’s first-quarter revenues are likely to have witnessed solid growth in the Online Ecosystem, driven by an expanding subscriber base for Quickbooks Online and ARPC. The Zacks Consensus Estimate for total Online Ecosystem’s revenues is pegged at $1.30 billion for the quarter under review, indicating a 5.3% increase from the prior year's reported figure. The consensus mark for Quickbooks Online’s revenues stands at $669 million, suggesting a 28.9% improvement year over year.
Revenues from the Credit Karma business (acquired in 2020) are likely to have boosted overall sales during the first quarter. The Zacks Consensus Estimate for Credit Karma’s revenues stands at $471 million, indicating year-over-year growth of 12.7%. The business unit contributed $475 million to INTU’s fourth-quarter fiscal 2022 total revenues.
The solid momentum of INTU’s leading product, QuickBooks Capital, and improving customer retention rates might have acted as tailwinds in the fiscal first quarter.
In the fiscal first quarter, an earlier IRS tax filing deadline for 2022, which might have led to lower revenues from the company’s Consumer tax business is likely to get partially offset by the addition of the Mailchimp platform (acquired in November 2021). The Zacks Consensus Estimate for the Consumer tax business’ revenues is pegged at $129 million, higher than the year-ago quarter figure of $120 million.
The transition of Desktop Ecosystem offerings to a subscription model might hurt sales growth.
Our proven model predicts an earnings beat for Intuit this time. The combination of a positive
Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is the case here. Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate ($1.21 per share) and the Zacks Consensus Estimate ($1.17 per share), is +3.15%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter. Zacks Rank: INTU carries a Zacks Rank #3. Other Stocks With the Favorable Combination
Per our model,
Dollar General ( DG Quick Quote DG - Free Report) , lululemon athletica ( LULU Quick Quote LULU - Free Report) and Okta ( OKTA Quick Quote OKTA - Free Report) are some stocks that investors can consider, as these have the right combination of elements to post an earnings beat in their upcoming releases. Dollar General has an Earnings ESP of +1.58% and currently carries a Zacks Rank #2. The company is slated to report its fourth-quarter fiscal 2023 results on Dec 1. DG’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 2.2%. You can see . the complete list of today’s Zacks #1 Rank stocks here The Zacks Consensus Estimate for Dollar General’s fiscal fourth-quarter earnings stands at $2.55 per share, implying a year-over-year increase of 22.6%. DG is estimated to report revenues of $9.43 billion, which suggests a rise of 10.7% from the year-ago quarter. lululemon athletica has an Earnings ESP of +4.91% and a Zacks Rank #2. The company is scheduled to report its third-quarter fiscal 2023 results on Dec 8. lululemon’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 10.4%. The Zacks Consensus Estimate for LULU’s fiscal third-quarter earnings is pegged at $1.95 per share, indicating a 20.4% surge from the year-ago quarter’s $1.62 per share. The consensus mark for revenues stands at $1.80 billion, suggesting a year-over-year increase of 24.4%. Okta has an Earnings ESP of +0.71% and carries a Zacks Rank #3 at present. The company is set to report its third-quarter fiscal 2023 results on Nov 30. OKTA’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 45.5%. The Zacks Consensus Estimate for quarterly loss is pegged at 24 cents per share, suggesting a year-over-year decrease of 242.9%. OKTA’s quarterly revenues are estimated to increase 32.2% year over year to $463.6 million. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.