r/valueinvesting
the next value play. Is it NOW, MSFT, CRM, INTU?
Author favors INTU for quality and valuation upside, and CRM for being cheapest, while MSFT and NOW are high quality but fully valued.
- INTU offers top-tier software compounding without an extreme premium.
- CRM is the cheapest on traditional metrics with strong FCF.
- MSFT and NOW represent exceptionally safe and high-quality businesses.
- MSFT and NOW are rarely cheap and trade at premiums, limiting value upside.
- CRM's growth has slowed from its hypergrowth era, causing market skepticism.
INTU
- Highest-quality business relative to current valuation.
- Dominant positions in TurboTax, Credit Karma and QuickBooks.
- Very high switching costs.
- AI likely strengthens rather than disrupts the moat.
- Trades well below the premium multiple many investors were willing to pay a few years ago.
CRM
- Cheapest on traditional metrics.
- Strong FCF generation.
- Market still somewhat skeptical because growth slowed from its hypergrowth era.
- If growth reaccelerates even modestly, multiple expansion could add to returns.
MSFT
- Probably the safest choice.
- Azure + AI + Office + Windows remains an incredible combination.
- However, the market already recognizes this, so the valuation discount isn't huge.
- Excellent risk-adjusted return, but not the biggest "value" among the four.
NOW
- Arguably the best business of the group operationally.
- But the stock rarely gets cheap.
- You're paying a premium for exceptional execution and long runway.
- I'd only call it a value play after a significant correction.
If I were deploying fresh capital today looking for the best mix of quality + upside from valuation, I'd lean:
INTU > CRM > MSFT > NOW
For pure quality regardless of valuation:
NOW ≈ MSFT > INTU > CRM
The interesting thing is that INTU is probably the only one here where you can reasonably argue you're buying a top-tier software compounder without paying an extreme premium.
just buy mfst, best quality and safest stock from your list. azure gonna be number 1 soon for cloud market share.
What makes you think azure is going to be no1 for cloud market share? Amazon is still miles ahead globally
This guy gets it, just bought into meta and have another order at $550, $1k stock in the making soon.
I hate that it’s come to this but Trump has invested heavily in NOW so I guess it’s NOW
Corporate accountants are not going to risk their career on an AI app. They use the accounting software for accountability purposes. They will sue INTU auditors if something goes wrong but who do you sue if AI messes up?
INTU has a strong reputation in the corporate world.
Well the biggest users of quickbooks are mostly small businesses. Not corporate accountants. Imo small businesses are the highest flight possibility simply because they have the lowest switching costs.
I remember 20 years ago people said INTU did not stand a chance. Too much software piracy was going on. Why go to the store and buy their software when you can download a bootlegged version online instead?
Also MSFT was using their windows monopoly to destroy software companies by bundling software preloaded into windows. Microsoft Money software bundle was a threat to INTU.
Yet INTU managed to survive....
ERPs from Oracle, SAP, etc.
MSFT was flat between 2000-2010. It took 10 years to recover from dot com bust.
Based on your posts here, you’re an index investor.
And ai isn't going to be able to do all the specific categorization of financials.
WEN
Y'all will just say anything now huh
"None of these are value plays until we see how Ai plays out." Is like saying "None of these are value plays until they 2-3x" the whole point why they are value plays is that their valuations are depressed due to AI fears.
I remember holding MSFT after the dot com crash and it traded flat between 2000-2010.
What if the AI bubble bursts and MSFT stays flat for another 10 years again ?