INTU valuation is potentially attractive; forward PE of 13.3 seems low despite justified AI-related discount, supported by ~10.82% projected EPS growth.

And then lastly, we have into it. They recently approved a roughly 15% dividend increase. So, now when we talk about in it, it's not been a secret. This is a software stock that has been decimated over the last year, down by 48.11% and the sell-off really started at the beginning of this year.

If we look at year-to- date returns, down by around 49%.

Of course, this pushes the starting yield higher. If we look at them on the dividend breakdown sheet, what you'll see is the starting yield is sitting at 1.42%. So, that's a relatively low yield.

It is higher than the S&P 500 as a whole, but dividend growth over the last 5 and 10 years has been incredible. roughly 14 to 14.5%. So, the recent dividend hike is right in line with where management has historically been growing the dividend.

And of course, they're only using about 19.5% of their free cash flow to actually pay out dividends. The 5-year free cash flow cagger is about 21.7%.

So, what's the result of this? Well, when we look at in it here on Seeking Alpha, this is where things get really interesting from a valuation perspective. Take a close look at this.

Historically, into it has traded at a premium. Why? Well, because it's a capital light business. A capital light business that was growing free cash flow at a substantial rate, growing dividends at a substantial rate.

So, they traded at PE multiples of anywhere from 35 to 40 on a non-GAAP basis.

And remember how earlier in the video we talked about looking at stocks through the lens of sources of returns? Well, we can see the source of the decline over the last year is strictly a valuation multiple decline.

They're now trading at a Ford PE of just 13.3 when the 5-year average is 32.6. That's about a 60% difference in the PE multiple. Just mind-blowing to think about.

So, what do we need to think about this? Does this automatically mean opportunity? Not necessarily. A PE multiple decline can be justified if the stock is projected to grow earnings at a much slower rate in the future.

Now, there's obviously a lot of debate as to whether or not that'll actually be the case for in it.

But if we just simply jump over to our sensitivity analysis and look at in it, what you'll see if we come down here is that the projected EPS growth rate through the year 2030 on a compounded annual growth rate basis is still sitting at roughly 10.82%.

So that's very strong earnings growth projected for a stock that's only trading at a forward PE multiple of 13.3.

So, what will AI disruption look like in the future? We know AI is going to change everything in the business world. And as a result, into it likely does deserve to trade at a discount relative to its historic average.

However, a PE multiple of 13.3 does seem a bit low at these prices.