Intuit provides payroll and payment processing software to small businesses with its QuickBooks platform, and it connects consumers with loans, insurance and credit cards through Credit Karma. It also offers “live” versions of TurboTax and QuickBooks that allow users to instantly connect with financial professionals.Intuit is best known for its market-leading tax preparation software TurboTax and accounting software QuickBooks.
That strategy continued to pay off in the quarter that ended Jan. 31, with revenue rising 14% year over year to $3 billion, while net income per share climbed 71%. Those results are particularly impressive because Credit Karma revenue dropped 16%, due in part to rising interest rates. Management offered bullish projections, expecting revenue to grow 8% to 9% in the third quarter, and announced a 15% dividend increase. Its dividend recently yielded 0.8%.
The index effect refers to a change in the price of a stock after it’s added to, or removed from, a major stock index. If a company is added to the S&P 500 index of 500 of America’s biggest companies, its stock price seems likely to rise. After all, there are trillions of dollars invested in index funds. So when that stock is added to the index, all those funds tracking the index will be buying shares; you might expect that kind of demand to push up the stock price, at least for a while.