Intuit Inc. (INTU) develops and sells management software to small and medium-sized businesses, consumers, and accountants. The stock finished at $173.32 on Wednesday, Feb. 22, up 9.8% year to date after reaching an all-time intraday high of $176.25. On February 9, the stock went into correction territory, trading as low as $150.43. The stock has up 15.2% since its low, suggesting that an earnings beat is already factored in.
Analysts anticipate that Intuit will post profits per share of only 9 cents on Thursday, Feb. 23 after the closing bell. According to Zacks Equity Research, the business’s recent acquisitions could help the company, but investors should be wary of growing expenditures. With the United States’ tax regulations changing this year, there may be charges connected to Intuit’s major products, QuickBooks (online management software) and TurboTax (tax preparation software). (See also: Intuit Stock Hits New Highs, but Rally Ends.)
The daily chart for Intuit
Courtesy of MetaStock Xenith
Since April 1, 2016, when the stock closed at $104.69, Intuit has been trading above a “golden cross.” Because it happened more than 52 weeks ago, this crossing is not displayed on the daily chart. When the 50-day simple moving average goes above the 200-day simple moving average, it indicates that higher prices are on the way. This corresponded to the stock’s all-time intraday high of $176.25 on February 21. The horizontal lines indicate that the stock is well over a valuation barrier. My monthly, yearly, quarterly, and semiannual value levels are correspondingly $160.57, $159.61, $158.33, and $155.81. The pivot for this week is $172.26.
The weekly chart for IntuitCourtesy of MetaStock Xenith
Despite the stock reaching a new high on Wednesday, Intuit’s weekly chart remains neutral. The stock is trading above its five-week modified moving average of $165.52 and much above its 200-week simple moving average of $110.02, which was last challenged during the week of Feb. 12, 2010, when the average was $28.69. The weekly 12 x 3 x 3 slow stochastic value is expected to fall to 75.08 this week, down from 76.66 on Feb. 16. This is a caution that gains may not be maintained after earnings.
Given these charts and research, investors should purchase Intuit stock if it falls below my monthly value threshold of $160.57. Because there are no dangerous levels, traders may want to consider employing a “sell stop” when the stock closes below its five-week modified moving average of $165.52 and continues to rise each week. (For additional information, read Intuit QuickBooks Now Allows You to Send Money Using Blockchain.)
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