Intuit Inc. (NTU), H&R Block, Inc. (HRB): A Leader in 2 Markets Makes for a Good Investment

On the small business software side, there are few other players that could theoretically steal some customers from Intuit Inc. (NASDAQ:INTU). While programs like Peachtree and AccountEdge are gaining some traction and getting good reviews, they are not much of a threat at this point. What Intuit should be worried about is a company like Microsoft Corporation (NASDAQ:MSFT) developing a product that competes with its own.  A lot of small-business owners (myself included) who have simpler accounting needs already use Excel to crunch the numbers, and it isn’t inconceivable to add some QuickBooks-like capabilities to the program. In fact, you may remember a program that was discontinued in 2009 called Microsoft Money, which was structured as a personal finance product and had many features that would be transferable to a business accounting program.

Could you imagine what a game-changer it would be for Intuit Inc. (NASDAQ:INTU) if the next version of Office Small Business featured a QuickBooks-like program? While I don’t view this as likely to happen, there is always a looming threat from one of the big software companies.

Conclusion

Although it leads its two major markets, I believe that Intuit Inc. (NASDAQ:INTU)still has plenty of room to grow. It is also pretty fairly valued at just 17.6 times forward earnings, which are expected to grow by a little over 10% annually over the next few years. At the current share price, Intuit would make a pretty low-risk/high reward potential addition to your tech holdings.

The article A Leader in 2 Markets Makes for a Good Investment originally appeared on Fool.com.

Matthew Frankel has no position in any stocks mentioned. The Motley Fool recommends Intuit. The Motley Fool owns shares of Intuit and Microsoft. 

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