Soft TurboTax Sales Sink Intuit
Shares of Intuit (INTU) are taking a beating after the maker of tax-preparation software announced disappointing sales figures for TurboTax.
In recent trading Thursday, the stock was off $2.50 a share, or 8.3%, to $27.50 on heavy volume.
With about one-third of the tax season left, sales of Intuit's flagship TurboTax program are up just 1% year over year.
However, the company said it is sticking by its earlier guidance for the quarter and said it expects total TurboTax unit sales to grow by 3% to 5% when the season ends.The growth slump was apparently caused by tough comparisons to last year's strong showing, price increases and competition from HR Block (HRB) and privately held TaxAct, said CIBC analyst Scott Schneeberger, whose firm does not have an investment banking relationship with Intuit. Microsoft (MSFT) competes with Intuit's personal finance products such as Quicken. Although the analyst expects the company to deliver double-digit revenue growth during the tax season, weak volume makes upside to the company's guidance "unlikely," he wrote in a note to clients.
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