Intuit (INTU) Slid on TurboTax Segment’s Underperformance

Intuit (INTU) Slid on TurboTax Segment’s Underperformance

Fri, August 28, 2026 at 6:42 PM GMT+3 3 min read

• INTU +2.29%
• ^GSPC +0.03%

Baron Capital, an investment management company, released its second-quarter 2026 investor letter for its "Baron Financials ETF". A letter can be downloaded here. In the quarter ended June 30, 2026, Baron Financials ETF (the Fund) increased by 1.82%, underperforming both the MSCI USA Financials Index (up 8.93%) and the FactSet Global FinTech Index (up 6.14%). U.S. equities soared, largely driven by AI infrastructure investments, despite challenges from the U.S.-Iran war, changing Federal Reserve rates, and consumer sentiment hampered by high living costs and inflation. Most gains were concentrated in Information Technology (IT) and Industrials, with IT outperforming the broader market at 31.8%, contributing significantly to the S&P 500's growth. Although growth outperformed value in the quarter, value remains ahead year to date. Small caps notably surpassed large caps. The Fund's underperformance relative to the Financials Index stemmed from lower bank exposure and a higher allocation to software and data firms affected by AI disruption fears. The Fund believes its holdings are undervalued and have a positive outlook, as economic conditions remain strong with healthy consumer and business spending. Also, check the fund's top five holdings to see its best picks in 2026.

In its second-quarter 2026 investor letter, Baron Financials ETF highlighted Intuit Inc. (NASDAQ:INTU). Intuit Inc. (NASDAQ:INTU), a financial software company offering products and services for financial management, payments, capital, compliance, and marketing, detracted 0.85% from the fund's performance this quarter. On August 27, 2026, Intuit Inc. (NASDAQ:INTU) closed at $348.00 per share. Over the past month, Intuit Inc. (NASDAQ:INTU) returned 10.10%, while its shares have declined 47.83% in the last 52 weeks. Intuit Inc. (NASDAQ:INTU) has a market capitalization of $95.19 billion, and its stock has traded within a 52-week range of $252.84 to $705.08.

Baron Financials ETF stated the following regarding Intuit Inc. (NASDAQ:INTU) in its Q2 2026 investor letter:

"Intuit Inc. (NASDAQ:INTU) is the leading provider of accounting software for small businesses and tax preparation software for individuals and tax professionals. Shares fell due to modest underperformance in the TurboTax segment, where revenue grew 7%, falling short of expectations for 8% growth. Management acknowledged volume losses among lower income filers who traded down to cheaper alternatives, fueling investor anxiety about competition and potential AI-driven disruption. Negative sentiment was further compounded by a 17% workforce reduction, which some investors interpreted as a defensive move to protect margins and a signal of demand challenges. Despite headwinds in some parts of the business, overall growth remains robust, with management expecting earnings growth of 18% this year and mid-teens growth over the coming years."

Intuit Inc. (NASDAQ:INTU) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 98 hedge fund portfolios held Intuit Inc. (NASDAQ:INTU) at the end of the second quarter, which was 92 in the previous quarter. While we acknowledge the potential of Intuit Inc. (NASDAQ:INTU) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In a previous article, we mentioned Intuit Inc. (NASDAQ:INTU), noting a 14% revenue increase to $21.4 billion for fiscal 2026, but it expects slower growth for fiscal 2027. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.