NYSE:HRB

Stock Analysis Report

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Executive Summary

H&R Block, Inc., through its subsidiaries, provides assisted income tax return preparation, do-it-yourself (DIY) tax, and virtual tax preparation services and products to the general public primarily in the United States, Canada, and Australia.


Snowflake Analysis

Established dividend payer with reasonable growth potential.


Similar Companies

Share Price & News

How has H&R Block's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HRB's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-5.8%

HRB

1.9%

US Consumer Services

1.9%

US Market


1 Year Return

-51.9%

HRB

22.7%

US Consumer Services

4.3%

US Market

Return vs Industry: HRB underperformed the US Consumer Services industry which returned 22.7% over the past year.

Return vs Market: HRB underperformed the US Market which returned 4.3% over the past year.


Shareholder returns

HRBIndustryMarket
7 Day-5.8%1.9%1.9%
30 Day-19.4%12.0%2.7%
90 Day11.5%32.3%26.4%
1 Year-49.2%-51.9%23.0%22.7%6.5%4.3%
3 Year-48.6%-54.9%82.2%75.0%35.1%26.2%
5 Year-43.4%-53.5%207.1%184.2%67.0%48.4%

Price Volatility Vs. Market

How volatile is H&R Block's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is H&R Block undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HRB ($14) is trading below our estimate of fair value ($36.26)

Significantly Below Fair Value: HRB is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: HRB is poor value based on its PE Ratio (499.2x) compared to the Consumer Services industry average (28.7x).

PE vs Market: HRB is poor value based on its PE Ratio (499.2x) compared to the US market (16.4x).


Price to Earnings Growth Ratio

PEG Ratio: HRB is poor value based on its PEG Ratio (9.8x)


Price to Book Ratio

PB vs Industry: HRB is overvalued based on its PB Ratio (37.9x) compared to the US Consumer Services industry average (2.2x).


Next Steps

Future Growth

How is H&R Block forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

50.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HRB's forecast earnings growth (50.9% per year) is above the savings rate (2.2%).

Earnings vs Market: HRB's earnings (50.9% per year) are forecast to grow faster than the US market (22.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: HRB's revenue (4.6% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: HRB's revenue (4.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HRB's Return on Equity is forecast to be very high in 3 years time (135.7%).


Next Steps

Past Performance

How has H&R Block performed over the past 5 years?

-1.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HRB has a large one-off loss of $106.0M impacting its April 30 2005 financial results.

Growing Profit Margin: HRB's current net profit margins (0.2%) are lower than last year (14.4%).


Past Earnings Growth Analysis

Earnings Trend: HRB's earnings have declined by -1.8% per year over the past 5 years.

Accelerating Growth: HRB's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: HRB had negative earnings growth (-98.8%) over the past year, making it difficult to compare to the Consumer Services industry average (18.3%).


Return on Equity

High ROE: HRB's Return on Equity (8.7%) is considered low.


Next Steps

Financial Health

How is H&R Block's financial position?


Financial Position Analysis

Short Term Liabilities: HRB's short term assets ($3.1B) exceed its short term liabilities ($1.6B).

Long Term Liabilities: HRB's short term assets ($3.1B) do not cover its long term liabilities ($3.5B).


Debt to Equity History and Analysis

Debt Level: HRB's debt to equity ratio (4941.5%) is considered high.

Reducing Debt: HRB's debt to equity ratio has increased from 29.4% to 4941.5% over the past 5 years.

Debt Coverage: HRB's debt is not well covered by operating cash flow (3.1%).

Interest Coverage: HRB's interest payments on its debt are not well covered by EBIT (2.2x coverage).


Balance Sheet


Next Steps

Dividend

What is H&R Block current dividend yield, its reliability and sustainability?

7.43%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HRB's dividend (7.43%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: HRB's dividend (7.43%) is in the top 25% of dividend payers in the US market (4.49%)


Stability and Growth of Payments

Stable Dividend: HRB's dividends per share have been stable in the past 10 years.

Growing Dividend: HRB's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (3708.1%), HRB's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HRB's dividends in 3 years are forecast to be well covered by earnings (45% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.1yrs

Average management tenure


CEO

Jeff Jones (52yo)

2.75yrs

Tenure

US$8,504,020

Compensation

Mr. Jeffrey J. Jones, II, also known as Jeff, has been the Chief Executive Officer and President at H&R Block, Inc. since October 9, 2017 and has been its Director since 2017. Mr. Jones is Director of Adva ...


CEO Compensation Analysis

Compensation vs Market: Jeff's total compensation ($USD8.50M) is above average for companies of similar size in the US market ($USD5.86M).

Compensation vs Earnings: Jeff's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jeffrey Jones
President2.75yrsUS$8.50m0.058% $1.6m
Tony Bowen
Chief Financial Officer4.17yrsUS$2.02m0.022% $590.7k
Kellie Logerwell
Chief Accounting Officer4yrsUS$643.99k0.0025% $66.8k
Thomas Gerke
Chief Administrative Officer & General Counsel4.17yrsUS$2.22m0.041% $1.1m
Karen Orosco
Senior Vice President of U.S. Retail Sales & Service4.17yrsUS$1.78m0.022% $603.6k
Vinoo Vijay
Chief Marketing Officer2.25yrsno datano data
Tiffany Monroe
Chief People Officer2.33yrsno datano data
Colby Brown
Vice President and Corporate Controller9.83yrsno datano data
Delos Knight
Senior Vice President of U.S. Franchise & International8.25yrsUS$1.66mno data
Jamil Khan
Chief Strategy & Development Officer0.75yrno datano data

4.1yrs

Average Tenure

49.5yo

Average Age

Experienced Management: HRB's management team is considered experienced (4.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jeffrey Jones
President2.75yrsUS$8.50m0.058% $1.6m
Bruce Rohde
Independent Director10yrsUS$271.37k0.0052% $140.1k
David Lewis
Independent Director15.75yrsUS$256.37k0.0021% $56.0k
Victoria Reich
Independent Director8.83yrsUS$271.37k0.0018% $49.0k
Paul Brown
Independent Director8.83yrsUS$267.37k0.0030% $79.8k
Christianna Wood
Independent Director12yrsUS$254.87k0.0065% $176.2k
Matthew Winter
Independent Director2.67yrsUS$257.71kno data
Robert Gerard
Independent Chairman of the Board9.25yrsUS$440.84k0.0073% $195.9k
Richard Johnson
Independent Director4.83yrsUS$257.37kno data
Angela Archon
Independent Director4.33yrsUS$251.37kno data

8.8yrs

Average Tenure

62yo

Average Age

Experienced Board: HRB's board of directors are considered experienced (8.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

H&R Block, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: H&R Block, Inc.
  • Ticker: HRB
  • Exchange: NYSE
  • Founded: 1955
  • Industry: Specialized Consumer Services
  • Sector: Consumer Services
  • Market Cap: US$2.695b
  • Shares outstanding: 192.48m
  • Website: https://www.hrblock.com

Number of Employees


Location

  • H&R Block, Inc.
  • One H&R Block Way
  • Kansas City
  • Missouri
  • 64105
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HRBNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1969
HRBDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1969
0HOBLSE (London Stock Exchange)YesCommon StockGBUSDJan 1969
H1RB34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

H&R Block, Inc., through its subsidiaries, provides assisted income tax return preparation, do-it-yourself (DIY) tax, and virtual tax preparation services and products to the general public primarily in the United States, Canada, and Australia. The company offers assisted income tax return preparation and related services through a system of retail offices operated directly by the company or by franchisees. It also develops and markets DIY income tax preparation software online, as well as through third-party retail stores and direct mail; and provides DIY tax services, including federal and state income tax returns, access to tax tips, advice and tax-related news, use of calculators for tax planning, and error checking and electronic filing. In addition, the company offers Refund Transfers and H&R Block Emerald Prepaid Mastercard, which enables clients to receive their tax refunds; Peace of Mind extended service plans; H&R Block Emerald Advance lines of credit; Tax Identity Shield that provides clients assistance in helping protect their tax identity and access to services to help restore their tax identity; refund advance loans; H&R Block Instant Refund; and H&R Block Pay With Refund services. Further, it provides small business financial solutions through its company-owned or franchise offices, and online. H&R Block, Inc. was founded in 1955 and is headquartered in Kansas City, Missouri. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/01 23:52
End of Day Share Price2020/07/01 00:00
Earnings2020/04/30
Annual Earnings2020/04/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.