H&R BLOCK INC (HRB) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HRB - US0936711052 - Common Stock
43.31 USD
+0.59 (+1.38%)
43.31 USD
0 (0%)
Overall HRB gets a fundamental rating of 6 out of 10. We evaluated HRB against 76 industry peers in the Diversified Consumer Services industry. While HRB belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. HRB may be a bit undervalued, certainly considering the very reasonable score on growth HRB also has an excellent dividend rating. This makes HRB very considerable for value and dividend investing!
1. Profitability
1.1 Basic Checks
HRB had positive earnings in the past year.
HRB had a positive operating cash flow in the past year.
Each year in the past 5 years HRB has been profitable.
In the past 5 years HRB always reported a positive cash flow from operatings.
1.2 Ratios
HRB has a Return On Assets of 23.16%. This is amongst the best in the industry. HRB outperforms 97.37% of its industry peers.
HRB has a Return On Invested Capital of 35.30%. This is amongst the best in the industry. HRB outperforms 100.00% of its industry peers.
HRB had an Average Return On Invested Capital over the past 3 years of 29.50%. This is significantly above the industry average of 8.97%.
The 3 year average ROIC (29.50%) for HRB is below the current ROIC(35.30%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.16% | ||
| ROE | N/A | ||
| ROIC | 35.3% |
ROA(3y)18.28%
ROA(5y)17.52%
ROE(3y)1016.86%
ROE(5y)695.21%
ROIC(3y)29.5%
ROIC(5y)27.67%
1.3 Margins
With an excellent Profit Margin value of 16.10%, HRB belongs to the best of the industry, outperforming 86.84% of the companies in the same industry.
In the last couple of years the Profit Margin of HRB has remained more or less at the same level.
With an excellent Operating Margin value of 22.52%, HRB belongs to the best of the industry, outperforming 88.16% of the companies in the same industry.
HRB's Operating Margin has improved in the last couple of years.
HRB has a Gross Margin (44.56%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of HRB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.52% | ||
| PM (TTM) | 16.1% | ||
| GM | 44.56% |
OM growth 3Y0.78%
OM growth 5Y25.98%
PM growth 3Y0.25%
PM growth 5YN/A
GM growth 3Y-0.84%
GM growth 5Y4.86%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so HRB is creating value.
HRB has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, HRB has less shares outstanding
HRB has a better debt/assets ratio than last year.
2.2 Solvency
HRB has an Altman-Z score of 3.12. This indicates that HRB is financially healthy and has little risk of bankruptcy at the moment.
HRB's Altman-Z score of 3.12 is fine compared to the rest of the industry. HRB outperforms 75.00% of its industry peers.
The Debt to FCF ratio of HRB is 3.01, which is a good value as it means it would take HRB, 3.01 years of fcf income to pay off all of its debts.
HRB's Debt to FCF ratio of 3.01 is fine compared to the rest of the industry. HRB outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.01 | ||
| Altman-Z | 3.12 |
ROIC/WACC4.52
WACC7.81%
2.3 Liquidity
A Current Ratio of 0.76 indicates that HRB may have some problems paying its short term obligations.
HRB has a worse Current ratio (0.76) than 72.37% of its industry peers.
A Quick Ratio of 0.76 indicates that HRB may have some problems paying its short term obligations.
With a Quick ratio value of 0.76, HRB is not doing good in the industry: 68.42% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.76 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.52% over the past year.
HRB shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 43.89% yearly.
HRB shows a decrease in Revenue. In the last year, the revenue decreased by -0.88%.
Measured over the past years, HRB shows a small growth in Revenue. The Revenue has been growing by 7.34% on average per year.
EPS 1Y (TTM)7.52%
EPS 3Y8.29%
EPS 5Y43.89%
EPS Q2Q%-2.56%
Revenue 1Y (TTM)-0.88%
Revenue growth 3Y2.79%
Revenue growth 5Y7.34%
Sales Q2Q%5.03%
3.2 Future
Based on estimates for the next years, HRB will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.96% on average per year.
Based on estimates for the next years, HRB will show a small growth in Revenue. The Revenue will grow by 3.32% on average per year.
EPS Next Y5.04%
EPS Next 2Y8.21%
EPS Next 3Y11.96%
EPS Next 5YN/A
Revenue Next Year4.25%
Revenue Next 2Y3.69%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 9.18, which indicates a very decent valuation of HRB.
HRB's Price/Earnings ratio is rather cheap when compared to the industry. HRB is cheaper than 88.16% of the companies in the same industry.
HRB is valuated cheaply when we compare the Price/Earnings ratio to 26.54, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 7.79, the valuation of HRB can be described as very cheap.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HRB indicates a rather cheap valuation: HRB is cheaper than 96.05% of the companies listed in the same industry.
HRB's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.78.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.18 | ||
| Fwd PE | 7.79 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HRB indicates a rather cheap valuation: HRB is cheaper than 80.26% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HRB indicates a rather cheap valuation: HRB is cheaper than 89.47% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.5 | ||
| EV/EBITDA | 7 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
HRB has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.82
PEG (5Y)0.21
EPS Next 2Y8.21%
EPS Next 3Y11.96%
5. Dividend
5.1 Amount
HRB has a Yearly Dividend Yield of 3.93%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.70, HRB pays a better dividend. On top of this HRB pays more dividend than 98.68% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.27, HRB pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.93% |
5.2 History
On average, the dividend of HRB grows each year by 6.79%, which is quite nice.
HRB has been paying a dividend for at least 10 years, so it has a reliable track record.
HRB has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.79%
Div Incr Years9
Div Non Decr Years27
5.3 Sustainability
HRB pays out 33.41% of its income as dividend. This is a sustainable payout ratio.
HRB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP33.41%
EPS Next 2Y8.21%
EPS Next 3Y11.96%
43.31
+0.59 (+1.38%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners97%
Inst Owner Change-1.59%
Ins Owners0.91%
Ins Owner Change3.26%
Market Cap5.48B
Revenue(TTM)3.77B
Net Income(TTM)607.22M
Analysts50.91
Price Target56.1 (29.53%)
Short Float %10.06%
Short Ratio9.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.93% |
Yearly Dividend1.44
Dividend Growth(5Y)6.79%
DP33.41%
Div Incr Years9
Div Non Decr Years27
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-4.25%
Min EPS beat(2)-20.65%
Max EPS beat(2)12.15%
EPS beat(4)2
Avg EPS beat(4)-3.26%
Min EPS beat(4)-20.65%
Max EPS beat(4)12.15%
EPS beat(8)6
Avg EPS beat(8)2.71%
EPS beat(12)9
Avg EPS beat(12)3.23%
EPS beat(16)13
Avg EPS beat(16)5.57%
Revenue beat(2)2
Avg Revenue beat(2)1.5%
Min Revenue beat(2)0.7%
Max Revenue beat(2)2.3%
Revenue beat(4)3
Avg Revenue beat(4)0%
Min Revenue beat(4)-3.34%
Max Revenue beat(4)2.3%
Revenue beat(8)7
Avg Revenue beat(8)1.26%
Revenue beat(12)9
Avg Revenue beat(12)1.7%
Revenue beat(16)12
Avg Revenue beat(16)1.92%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-0.27%
EPS NQ rev (3m)-3.14%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)-1.59%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)0.9%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.18 | ||
| Fwd PE | 7.79 | ||
| P/S | 1.45 | ||
| P/FCF | 9.5 | ||
| P/OCF | 8.39 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 7 |
EPS(TTM)4.72
EY10.9%
EPS(NY)5.56
Fwd EY12.84%
FCF(TTM)4.56
FCFY10.52%
OCF(TTM)5.16
OCFY11.92%
SpS29.82
BVpS-4.36
TBVpS-12.68
PEG (NY)1.82
PEG (5Y)0.21
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.16% | ||
| ROE | N/A | ||
| ROCE | 45.13% | ||
| ROIC | 35.3% | ||
| ROICexc | 44.13% | ||
| ROICexgc | 146.48% | ||
| OM | 22.52% | ||
| PM (TTM) | 16.1% | ||
| GM | 44.56% | ||
| FCFM | 15.28% |
ROA(3y)18.28%
ROA(5y)17.52%
ROE(3y)1016.86%
ROE(5y)695.21%
ROIC(3y)29.5%
ROIC(5y)27.67%
ROICexc(3y)56.68%
ROICexc(5y)50.15%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)37.72%
ROCE(5y)35.37%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y16.18%
ROICexc growth 5Y32.13%
OM growth 3Y0.78%
OM growth 5Y25.98%
PM growth 3Y0.25%
PM growth 5YN/A
GM growth 3Y-0.84%
GM growth 5Y4.86%
F-Score6
Asset Turnover1.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.01 | ||
| Debt/EBITDA | 1.8 | ||
| Cap/Depr | 65.42% | ||
| Cap/Sales | 2.03% | ||
| Interest Coverage | 10.19 | ||
| Cash Conversion | 67.55% | ||
| Profit Quality | 94.88% | ||
| Current Ratio | 0.76 | ||
| Quick Ratio | 0.76 | ||
| Altman-Z | 3.12 |
F-Score6
WACC7.81%
ROIC/WACC4.52
Cap/Depr(3y)58.64%
Cap/Depr(5y)50.63%
Cap/Sales(3y)1.98%
Cap/Sales(5y)1.86%
Profit Quality(3y)115.52%
Profit Quality(5y)116.11%
High Growth Momentum
Growth
EPS 1Y (TTM)7.52%
EPS 3Y8.29%
EPS 5Y43.89%
EPS Q2Q%-2.56%
EPS Next Y5.04%
EPS Next 2Y8.21%
EPS Next 3Y11.96%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.88%
Revenue growth 3Y2.79%
Revenue growth 5Y7.34%
Sales Q2Q%5.03%
Revenue Next Year4.25%
Revenue Next 2Y3.69%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
EBIT growth 1Y47.2%
EBIT growth 3Y3.59%
EBIT growth 5Y35.23%
EBIT Next Year14.81%
EBIT Next 3Y8.27%
EBIT Next 5YN/A
FCF growth 1Y-22.36%
FCF growth 3Y-7.08%
FCF growth 5Y85.45%
OCF growth 1Y-19.28%
OCF growth 3Y-5.57%
OCF growth 5Y44.25%
H&R BLOCK INC / HRB FAQ
What is the fundamental rating for HRB stock?
ChartMill assigns a fundamental rating of 6 / 10 to HRB.
What is the valuation status of H&R BLOCK INC (HRB) stock?
ChartMill assigns a valuation rating of 8 / 10 to H&R BLOCK INC (HRB). This can be considered as Undervalued.
How profitable is H&R BLOCK INC (HRB) stock?
H&R BLOCK INC (HRB) has a profitability rating of 8 / 10.
What is the expected EPS growth for H&R BLOCK INC (HRB) stock?
The Earnings per Share (EPS) of H&R BLOCK INC (HRB) is expected to grow by 5.04% in the next year.
Is the dividend of H&R BLOCK INC sustainable?
The dividend rating of H&R BLOCK INC (HRB) is 8 / 10 and the dividend payout ratio is 33.41%.