H&R BLOCK INC (HRB) Stock Fundamental Analysis
USA - NYSE:HRB - US0936711052 - Common Stock
51.25 USD
-1.18 (-2.25%)
51.25 USD
0 (0%)
Taking everything into account, HRB scores 7 out of 10 in our fundamental rating. HRB was compared to 77 industry peers in the Diversified Consumer Services industry. HRB scores excellent on profitability, but there are some minor concerns on its financial health. HRB scores decently on growth, while it is valued quite cheap. This could make an interesting combination. HRB also has an excellent dividend rating. These ratings could make HRB a good candidate for value and dividend investing.
1. Profitability
1.1 Basic Checks
In the past year HRB was profitable.
In the past year HRB had a positive cash flow from operations.
HRB had positive earnings in each of the past 5 years.
HRB had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of HRB (18.40%) is better than 93.51% of its industry peers.
With an excellent Return On Equity value of 675.51%, HRB belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
HRB's Return On Invested Capital of 32.95% is amongst the best of the industry. HRB outperforms 98.70% 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 9.48%.
The last Return On Invested Capital (32.95%) for HRB is above the 3 year average (29.50%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.4% | ||
| ROE | 675.51% | ||
| ROIC | 32.95% |
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
The Profit Margin of HRB (15.97%) is better than 87.01% of its industry peers.
HRB's Profit Margin has been stable in the last couple of years.
HRB has a better Operating Margin (22.01%) than 87.01% of its industry peers.
In the last couple of years the Operating Margin of HRB has grown nicely.
HRB's Gross Margin of 44.53% is in line compared to the rest of the industry. HRB outperforms 46.75% of its industry peers.
In the last couple of years the Gross Margin of HRB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.01% | ||
| PM (TTM) | 15.97% | ||
| GM | 44.53% |
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.
Compared to 1 year ago, HRB has less shares outstanding
HRB has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, HRB has an improved debt to assets ratio.
2.2 Solvency
HRB has an Altman-Z score of 3.21. This indicates that HRB is financially healthy and has little risk of bankruptcy at the moment.
HRB's Altman-Z score of 3.21 is fine compared to the rest of the industry. HRB outperforms 77.92% of its industry peers.
HRB has a debt to FCF ratio of 2.49. This is a good value and a sign of high solvency as HRB would need 2.49 years to pay back of all of its debts.
HRB has a better Debt to FCF ratio (2.49) than 75.32% of its industry peers.
A Debt/Equity ratio of 12.86 is on the high side and indicates that HRB has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 12.86, HRB is doing worse than 83.12% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for HRB, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.86 | ||
| Debt/FCF | 2.49 | ||
| Altman-Z | 3.21 |
ROIC/WACC4.22
WACC7.8%
2.3 Liquidity
HRB has a Current Ratio of 0.90. This is a bad value and indicates that HRB is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of HRB (0.90) is worse than 64.94% of its industry peers.
HRB has a Quick Ratio of 0.90. This is a bad value and indicates that HRB is not financially healthy enough and could expect problems in meeting its short term obligations.
HRB's Quick ratio of 0.90 is on the low side compared to the rest of the industry. HRB is outperformed by 62.34% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.32% over the past year.
The Earnings Per Share has been growing by 43.89% on average over the past years. This is a very strong growth
The Revenue has decreased by -0.87% in the past year.
HRB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.34% yearly.
EPS 1Y (TTM)5.32%
EPS 3Y8.29%
EPS 5Y43.89%
EPS Q2Q%20.11%
Revenue 1Y (TTM)-0.87%
Revenue growth 3Y2.79%
Revenue growth 5Y7.34%
Sales Q2Q%4.55%
3.2 Future
HRB is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.47% yearly.
HRB is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.32% yearly.
EPS Next Y5.25%
EPS Next 2Y7.99%
EPS Next 3Y12.47%
EPS Next 5YN/A
Revenue Next Year4.28%
Revenue Next 2Y3.76%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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 10.79, 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 87.01% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.08, HRB is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.25, the valuation of HRB can be described as very reasonable.
89.61% of the companies in the same industry are more expensive than HRB, based on the Price/Forward Earnings ratio.
HRB's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.09.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.79 | ||
| Fwd PE | 10.25 |
4.2 Price Multiples
83.12% of the companies in the same industry are more expensive than HRB, based on the Enterprise Value to EBITDA ratio.
HRB's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HRB is cheaper than 89.61% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.94 | ||
| EV/EBITDA | 7.64 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of HRB may justify a higher PE ratio.
A more expensive valuation may be justified as HRB's earnings are expected to grow with 12.47% in the coming years.
PEG (NY)2.05
PEG (5Y)0.25
EPS Next 2Y7.99%
EPS Next 3Y12.47%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.21%, HRB has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.95, HRB pays a better dividend. On top of this HRB pays more dividend than 98.70% of the companies listed in the same industry.
HRB's Dividend Yield is a higher than the S&P500 average which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.21% |
5.2 History
On average, the dividend of HRB grows each year by 6.79%, which is quite nice.
HRB has paid a dividend for at least 10 years, which is a reliable track record.
HRB has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.79%
Div Incr Years9
Div Non Decr Years27
5.3 Sustainability
HRB pays out 32.86% of its income as dividend. This is a sustainable payout ratio.
The dividend of HRB is growing, but earnings are growing more, so the dividend growth is sustainable.
DP32.86%
EPS Next 2Y7.99%
EPS Next 3Y12.47%
51.25
-1.18 (-2.25%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners95.26%
Inst Owner Change-1%
Ins Owners0.95%
Ins Owner Change4.37%
Market Cap6.55B
Revenue(TTM)3.76B
Net Income(TTM)600.50M
Analysts50.91
Price Target56.1 (9.46%)
Short Float %9.58%
Short Ratio8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.21% |
Yearly Dividend1.44
Dividend Growth(5Y)6.79%
DP32.86%
Div Incr Years9
Div Non Decr Years27
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-8.81%
Min EPS beat(2)-20.65%
Max EPS beat(2)3.03%
EPS beat(4)2
Avg EPS beat(4)-5.84%
Min EPS beat(4)-20.65%
Max EPS beat(4)3.03%
EPS beat(8)6
Avg EPS beat(8)2.12%
EPS beat(12)9
Avg EPS beat(12)3.02%
EPS beat(16)13
Avg EPS beat(16)6.53%
Revenue beat(2)2
Avg Revenue beat(2)1.31%
Min Revenue beat(2)0.31%
Max Revenue beat(2)2.3%
Revenue beat(4)3
Avg Revenue beat(4)0.29%
Min Revenue beat(4)-3.34%
Max Revenue beat(4)2.3%
Revenue beat(8)6
Avg Revenue beat(8)1.16%
Revenue beat(12)8
Avg Revenue beat(12)1.47%
Revenue beat(16)12
Avg Revenue beat(16)2.69%
PT rev (1m)0%
PT rev (3m)-14.06%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.55%
EPS NY rev (1m)0%
EPS NY rev (3m)-3.79%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.3%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.79 | ||
| Fwd PE | 10.25 | ||
| P/S | 1.74 | ||
| P/FCF | 10.94 | ||
| P/OCF | 9.62 | ||
| P/B | 73.72 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.64 |
EPS(TTM)4.75
EY9.27%
EPS(NY)5
Fwd EY9.76%
FCF(TTM)4.68
FCFY9.14%
OCF(TTM)5.32
OCFY10.39%
SpS29.41
BVpS0.7
TBVpS-7.61
PEG (NY)2.05
PEG (5Y)0.25
Graham Number8.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.4% | ||
| ROE | 675.51% | ||
| ROCE | 42.13% | ||
| ROIC | 32.95% | ||
| ROICexc | 65.95% | ||
| ROICexgc | N/A | ||
| OM | 22.01% | ||
| PM (TTM) | 15.97% | ||
| GM | 44.53% | ||
| FCFM | 15.92% |
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-Score7
Asset Turnover1.15
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.86 | ||
| Debt/FCF | 2.49 | ||
| Debt/EBITDA | 1.21 | ||
| Cap/Depr | 70.22% | ||
| Cap/Sales | 2.18% | ||
| Interest Coverage | 11.09 | ||
| Cash Conversion | 72.07% | ||
| Profit Quality | 99.73% | ||
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 3.21 |
F-Score7
WACC7.8%
ROIC/WACC4.22
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)5.32%
EPS 3Y8.29%
EPS 5Y43.89%
EPS Q2Q%20.11%
EPS Next Y5.25%
EPS Next 2Y7.99%
EPS Next 3Y12.47%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.87%
Revenue growth 3Y2.79%
Revenue growth 5Y7.34%
Sales Q2Q%4.55%
Revenue Next Year4.28%
Revenue Next 2Y3.76%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
EBIT growth 1Y38.23%
EBIT growth 3Y3.59%
EBIT growth 5Y35.23%
EBIT Next Year14.81%
EBIT Next 3Y8.21%
EBIT Next 5YN/A
FCF growth 1Y-8.88%
FCF growth 3Y-7.08%
FCF growth 5Y85.45%
OCF growth 1Y-5.55%
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 7 / 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 9 / 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 5.25% 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 32.86%.