Core Viewpoint - Intuit (INTU) has faced significant valuation challenges, with analysts warning of substantial downside risks despite strong business performance. The company's stock has dropped nearly 50% due to market concerns that AI could disrupt its core business [2][3]. Group 1: Reasons for Stock Decline - The recent decline in Intuit's stock is attributed to market sentiment rather than fundamental performance, with valuation multiples compressing from approximately 30x to 19x, a reduction of over 50% [4]. - The sell-off aligns with a broader pullback in the software sector, reflecting a market perception that if software development costs approach zero, the value of Intuit's software business will significantly decrease [8]. Group 2: Business Resilience and Growth - Despite the stock decline, Intuit's business remains robust, with several segments showing accelerated growth. For FY24, total revenue is projected to be $16.285 billion, with a year-over-year growth rate of 13% [11]. - TurboTax, a key revenue driver, is expected to see growth despite AI advancements, as users trust its established solutions for maximizing tax returns and minimizing risks [9][20]. Group 3: Financial Performance and Valuation - Intuit's non-GAAP operating margin improved by 3.4 percentage points, and GAAP operating income nearly doubled, indicating strong operational performance [12]. - The current valuation of Intuit at $443 reflects a price-to-earnings ratio below 20x, which is 48% lower than its five-year average, suggesting a significant undervaluation [15]. - Analysts emphasize that the current valuation based on GAAP earnings guidance is only 28x, a critical metric for assessing the company's financial health [17].