NYSE:HRB appears to be flying under the radar despite its strong fundamentals.

Last update: Dec 2, 2024

Take a closer look at H&R BLOCK INC (NYSE:HRB), a remarkable value stock uncovered by our stock screener. NYSE:HRB excels in fundamentals and maintains a very reasonable valuation. Let's break it down further.

Exploring NYSE:HRB's Valuation

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NYSE:HRB has earned a 8 for valuation:

HRB's Price/Earnings ratio is rather cheap when compared to the industry. HRB is cheaper than 83.08% of the companies in the same industry.
HRB is valuated cheaply when we compare the Price/Earnings ratio to 29.78, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 11.42, the valuation of HRB can be described as very reasonable.
Based on the Price/Forward Earnings ratio, HRB is valued cheaply inside the industry as 89.23% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 24.23. HRB is valued rather cheaply when compared to this.
Based on the Enterprise Value to EBITDA ratio, HRB is valued a bit cheaper than the industry average as 64.62% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, HRB is valued cheaper than 89.23% of the companies in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HRB has a very decent profitability rating, which may justify a higher PE ratio.

A Closer Look at Profitability for NYSE:HRB

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:HRB scores a 7 out of 10:

HRB has a better Return On Assets (16.49%) than 90.77% of its industry peers.
The Return On Invested Capital of HRB (25.89%) is better than 95.38% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HRB is significantly above the industry average of 12.40%.
HRB has a better Profit Margin (11.05%) than 80.00% of its industry peers.
HRB's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 15.17%, HRB is doing good in the industry, outperforming 80.00% of the companies in the same industry.
HRB's Operating Margin has improved in the last couple of years.

What does the Health looks like for NYSE:HRB

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:HRB, the assigned 5 for health provides valuable insights:

An Altman-Z score of 3.59 indicates that HRB is not in any danger for bankruptcy at the moment.
HRB has a Altman-Z score of 3.59. This is in the better half of the industry: HRB outperforms 78.46% of its industry peers.
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.
The Debt to FCF ratio of HRB (2.27) is better than 75.38% of its industry peers.

Deciphering NYSE:HRB's Growth Rating

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:HRB has achieved a 5 out of 10:

HRB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.62%, which is quite good.
HRB shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.54% yearly.
The Revenue has grown by 9.44% in the past year. This is quite good.
HRB is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.29% yearly.

More Decent Value stocks can be found in our Decent Value screener.

Check the latest full fundamental report of HRB for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.