Intuit (INTU) Plunges 5% Amid Insider Sales and Cautious Guidance – What’s Next for the Tech Giant?

Summary
• Intuit (INTU) trades at $629.06, down 5.03% from its previous close of $662.42
• Intraday range spans $625.61 (low) to $661.99 (high), reflecting sharp volatility
• Insider sales of $227M and Q2 2026 guidance below 52W high of $813.70 drive selloff

Intuit’s stock has plunged to a 12-month low amid a perfect storm of insider selling, cautious earnings guidance, and sector-wide pressure. With analysts still bullish on a $796.60 price target, the question looms: Is this a buying opportunity or a warning sign for long-term holders?

Insider Selling and Cautious Guidance Drive Sharp Decline in Intuit Shares
Intuit’s 5% intraday drop stems from three key catalysts. First, executives including CFO Sandeep Aujla sold $227M in shares over 90 days, signaling internal skepticism. Second, Q2 2026 guidance of $3.63–$3.68 EPS fell short of Wall Street’s expectations, despite Q3 outperforming estimates. Third, sector-wide weakness in software stocks amplified the sell-off. Analysts remain cautiously optimistic, but the immediate pressure reflects a mix of profit-taking and strategic caution.

Application Software Sector Under Pressure as Microsoft Slides 2.15%
The Application Software sector mirrored Intuit’s decline, with Microsoft (MSFT) falling 2.15% intraday. While Intuit’s drop was exacerbated by insider sales and guidance, the broader sector faces headwinds from regulatory scrutiny and AI-driven competition. Microsoft’s slide highlights the sector’s vulnerability to macroeconomic shifts, though Intuit’s 5% move remains more pronounced due to its specific governance and guidance issues.

Options Playbook: High-Leverage Calls and Puts for Intuit’s Volatile Outlook
• MACD: 3.93 (bullish divergence), Signal Line: 4.00 (bearish crossover), Histogram: -0.08 (bearish)
• RSI: 50.0 (neutral), Bollinger Bands: $649.95 (lower band), $683.83 (upper band)
• 200D MA: $682.33 (price below), 30D MA: $659.02 (price near)

Key levels to watch: $640 (psychological support), $666.89 (middle Bollinger Band), and $682.33 (200D MA). Short-term bearish momentum persists, but RSI neutrality suggests potential for a rebound. No leveraged ETF data is available, but options offer high-risk/high-reward plays.

Top Option 1: INTU20260109C635
• Code: INTU20260109C635
• Type: Call
• Strike: $635
• Expiry: 2026-01-09
• IV: 28.80% (moderate)
• Leverage: 73.83% (high)
• Delta: 0.438 (moderate sensitivity)
• Theta: -1.83 (rapid time decay)
• Gamma: 0.0147 (moderate price sensitivity)
• Turnover: 36,813 (liquid)
• Payoff at 5% downside ($597.59): $0 (out-of-money)
• Ideal for aggressive bulls expecting a short-term rebound above $635.

Top Option 2: INTU20260116C640
• Code: INTU20260116C640
• Type: Call
• Strike: $640
• Expiry: 2026-01-16
• IV: 25.43% (moderate)
• Leverage: 70.76% (high)
• Delta: 0.397 (moderate sensitivity)
• Theta: -0.98 (moderate time decay)
• Gamma: 0.0119 (moderate price sensitivity)
• Turnover: 787,423 (highly liquid)
• Payoff at 5% downside ($597.59): $0 (out-of-money)
• Best for traders betting on a post-earnings bounce above $640.

Hook: Aggressive bulls may consider INTU20260116C640 into a bounce above $640, while bears should watch for a breakdown below $625.

Backtest Intuit Stock Performance
The backtest of Intuit (INTU) after a -5% intraday plunge from 2022 to the present shows favorable performance metrics. The 3-Day win rate is 54.81%, the 10-Day win rate is 51.88%, and the 30-Day win rate is 57.74%, indicating that the stock tends to rebound in the short term following a significant drop. The maximum return during the backtest period was 3.24%, which occurred on day 58, suggesting that while the stock can recover, the returns are generally modest.

Bullish Rebound or Further Downtrend? Key Levels to Watch in Intuit’s Critical Crossroads
Intuit’s 5% drop reflects a mix of internal skepticism and sector-wide pressure, but its 52W low of $532.65 remains a distant floor. The 200D MA at $682.33 and RSI neutrality suggest potential for a rebound, though bearish momentum persists. Investors should monitor the $640 level for a bullish reversal and $625 for a breakdown. Meanwhile, Microsoft’s 2.15% decline underscores sector fragility. Action: Aggressive bulls may consider INTU20260116C640 into a bounce above $640, while bears should watch for a breakdown below $625.