Intuit (INTU) Stock Rises Ahead of Earnings Release

Intuit (INTU) shares climbed today ahead of the company's earnings release tomorrow.
By Tony Owusu ,

NEW YORK (TheStreet) -- Shares of Intuit  (INTU) - Get Report closed up by 0.2% to $96.62 on Wednesday afternoon, ahead of the release of the company's fiscal 2016 first quarter earnings results, due out after the close tomorrow afternoon.

The Mountain View, CA-based financial management solutions company is expected to report a first quarter net loss of 4 cents per share on revenue of $671 million.

The company itself provided revenue guidance between $660 million and $680 million, or an 8% to 10% increase over the year ago quarter.

In the year ago period, the company reported a first quarter net loss of 10 cents per share on revenue of $672 million. 

Separately, TheStreet Ratings team rates INTUIT INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

We rate INTUIT INC (INTU) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including premium valuation, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 148.3% when compared to the same quarter one year prior, rising from -$29.00 million to $14.00 million.
  • INTU's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.07, which illustrates the ability to avoid short-term cash problems.
  • Despite the weak revenue results, INTU has outperformed against the industry average of 17.3%. Since the same quarter one year prior, revenues slightly dropped by 2.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to -$218.00 million or 159.52% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • You can view the full analysis from the report here: INTU

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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