Goldman Sachs’ Top Fund Manager Stock Picks: 25 Best Overweight Stocks

8. Intuit Inc. (NASDAQ:INTU)

Number of Hedge Fund Investors In Q2 2024: 82

Mutual Fund Overweight Percentage: 0.13%

Intuit Inc. (NASDAQ:INTU) is a software as a service (SaaS) firm that helps businesses with their daily operations. The firm’s software allows customers to manage payroll, compliance, accounting, and secure access to credit. Its shares have been on quite a roller coaster this year. Intuit Inc. (NASDAQ:INTU)’s stock tumbled by 16% in May as the firm delivered the antithesis of what underlies the narrative of most SaaS stocks. The company’s management warned during the Q1 2024 earnings call that it could lose a stunning 1 million customers using its TurboTax software. This was because the IRS had debuted its software to enable people to self file taxes, and the comments indicated to investors that Intuit Inc. (NASDAQ:INTU) might stop growing with one software product. After the 16% drop, its stock soared by 18% between June and July only to pare them back in early August due to market worries of a recession. Intuit Inc. (NASDAQ:INTU)’s second quarter results sent the stock tumbling 7.5% after its revenue and earnings guidance for the October quarter, which sat at $3.13 billion and $2.36, missed analyst estimates of $3.37 and $2.78. Intuit Inc. (NASDAQ:INTU) also lowered its consumer growth target to 6% to 10% from an earlier 8% to 12%. Since growth and cost control are the keys of SaaS hypothesis, investors weren’t impressed. Looking ahead, cross selling and margins should be pivotal for any tailwinds to Intuit Inc. (NASDAQ:INTU)’s shares.

Baron Funds mentioned Intuit Inc. (NASDAQ:INTU) in its Q2 2024 investor letter. Here is what the fund said:

“Intuit Inc. has been rolling out Intuit Assist, a GenAI powered digital assistant, across its product lines to help Credit Karma users select new credit cards, QuickBooks customers forecast cash flow, Mailchimp customers create targeted email marketing campaigns, and TurboTax customers understand changes in their tax returns from the prior year. Klarna, the privately held consumer lending and payments company, is cutting costs by using GenAI assistants to handle two-thirds of customer service chats and reduce its dependency on external marketing agencies. We consider these GenAI advancements to be evolutionary rather than revolutionary, but we continue to closely monitor the impact of new technologies on the fintech industry.”