Analyst Note| Julie Bhusal Sharma |
On Dec. 7, Intuit updated fiscal 2021 second-quarter and annual guidance to reflect its acquisition of Credit Karma, which closed on Dec. 3. Intuit’s previous outlook for fiscal 2021 did not factor in the acquisition as the company had previously only shared that the acquisition would close by the end of the fiscal year. After updating our model for the adjustments, which includes a margin dilutive 2021, our fair value estimate for wide-moat Intuit of $314 per share remains unchanged, as our forecast beyond fiscal 2021 already incorporated the Credit Karma acquisition. With shares trading at $372 per share, we suggest waiting for a greater margin of safety before investing in the tax and small business accounting giant.