The best way to compare Intuit (QuickBooks) vs Xero is to compare stock prices.
This also is the most dramatic and objective way to show what smart investors believe about the relative future of Intuit vs Xero and their products. This single measurement combines all the factors and opinions of everyone, in a single unquestionable summary. You can argue with the result below, but you are not arguing with me. You are arguing against everyone's combined judgment, which everyone backs with his money.
Big differences in stock price changes, as there are in this five-year chart, tend to create a self-fulfilling prophecy. Winners are far more likely to get the extra capital needed to expand quickly and survive problems. This is especially important once you learn that stock prices are a leading indicator. That is, they tend to predict the future effectively. In the case of Intuit vs Xero, the future in this chart very clearly show Xero wins big, VERY BIG!
........
What is even more interesting is that Intuit recently sold or will sell website, real estate, financial service and medical service businesses. It lost about $320 million ($1.35 billion cost, $1.03 billion sale) on a July 2013 Digital Insight sale alone.
Most important, Intuit, "would use the proceeds from the IFS deal to boost its share repurchase program... As of April 30, Intuit had $1.4 billion remaining for stock repurchases under the program..."
...
Getting rid of these businesses, without spending this money on current businesses, seems to mean that Intuit is anticipating smaller future operations. Therefore, it is EFFECTIVELY ALREADY LIQUIDATING! No wonder Intuit insiders sold more than $1 billion in stock in four years. *Intuit CEO Brad Smith, in particular, seems only to have stock option shares and sells most of them fast.
So where does Intuit stock go from here? Intuit has a stock market capitalization of about $20 billion. A trailing price earnings ratio of 32 ($20 billion / $614 million) seems very excessive for an effectively liquidating company, with little book value, **especially this makes it look like Intuit has already given up.
That is why this post is Intuit deathwatch 4.
So where does Xero stock go from here? It looks like Xero stock will keep increasing rapidly. It currently has a market cap of about $2 billion, but recent U.S. and international conferences spotlighted already very successful U.S. efforts with leading QuickBooks supporters.
** Xero CEO Rod Drury recently said that the massive U.S. accounting market was now the fastest-growing area for Xero. Intuit was always a primarily U.S. play. However, the beautiful Xero software has long been multi-currency and multi-lingual, with happy customers in more than 100 countries (as of more than two years ago).
... (can Xero take on Netsuite??..)
There is one more big reason that Xero will scale up far better than QuickBooks. If you think that Xero is only a small business play, think again. ....
He (Road Drury) has long been using Rackspace and other highly respected secure web hosts. Unlike a rather new static Intuit web host facility, Rackspace users can scale up or down very quickly. I have no doubt this already lets Rod increase and decrease computer power, every day and night, on a rotating schedule around the world.
It also will let Xero very rapidly scale up when Rod decides that he knows enough, about NetSuite and Xero, to give us Xero for large companies.
That is why Xero stock should go much higher. With a market cap of about $2 billion, Xero is well on its way towards
**exceeding Intuit's $20 billion market cap.
If anything, Xero professional accountant focus, better global reach and scalability should take it far higher.
(20min delay)