Why NYSE:HRB qualifies as a good dividend investing stock.

Last update: Oct 29, 2024

Our stock screener has singled out H&R BLOCK INC (NYSE:HRB) as a promising choice for dividend investors. NYSE:HRB not only scores well in profitability, solvency, and liquidity but also offers a decent dividend. We'll explore this further.

Understanding NYSE:HRB's Dividend

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NYSE:HRB has been assigned a 7 for dividend:

HRB's Dividend Yield is rather good when compared to the industry average which is at 271.89. HRB pays more dividend than 89.06% of the companies in the same industry.
HRB has been paying a dividend for at least 10 years, so it has a reliable track record.
HRB has not decreased their dividend for at least 10 years, which is a reliable track record.
HRB's earnings are growing more than its dividend. This makes the dividend growth sustainable.

ChartMill's Evaluation of Health

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:HRB has received a 7 out of 10:

HRB has an Altman-Z score of 3.48. This indicates that HRB is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.48, HRB belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
The Debt to FCF ratio of HRB is 2.27, which is a good value as it means it would take HRB, 2.27 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.27, HRB is doing good in the industry, outperforming 76.56% of the companies in the same industry.
Although HRB does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

Profitability Assessment of NYSE:HRB

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:HRB has earned a 8 out of 10:

HRB's Return On Assets of 13.33% is amongst the best of the industry. HRB outperforms 90.63% of its industry peers.
HRB has a Return On Equity of 473.79%. This is amongst the best in the industry. HRB outperforms 100.00% of its industry peers.
HRB has a better Return On Invested Capital (21.03%) than 92.19% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for HRB is significantly above the industry average of 11.99%.
The 3 year average ROIC (27.24%) for HRB is well above the current ROIC(21.03%). The reason for the recent decline needs to be investigated.
HRB has a better Profit Margin (11.31%) than 81.25% of its industry peers.
In the last couple of years the Profit Margin of HRB has grown nicely.
HRB's Operating Margin of 15.79% is fine compared to the rest of the industry. HRB outperforms 79.69% of its industry peers.
In the last couple of years the Operating Margin of HRB has grown nicely.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of HRB

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.