H&R BLOCK INC (HRB) Stock Fundamental Analysis
USA - NYSE:HRB - US0936711052 - Common Stock
51.76 USD
+0.62 (+1.21%)
51.76 USD
0 (0%)
Overall HRB gets a fundamental rating of 7 out of 10. We evaluated HRB against 75 industry peers in the Diversified Consumer Services industry. HRB scores excellent on profitability, but there are some minor concerns on its financial health. HRB is valued quite cheap, while showing a decent growth score. This is a good combination! HRB also has an excellent dividend rating. These ratings would make HRB suitable 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.
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 93.33% of its industry peers.
HRB has a Return On Equity of 675.51%. This is amongst the best in the industry. HRB outperforms 100.00% of its industry peers.
The Return On Invested Capital of HRB (32.95%) is better than 98.67% 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 9.69%.
The 3 year average ROIC (29.50%) for HRB is below the current ROIC(32.95%), indicating increased profibility in the last year.
| 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
HRB has a better Profit Margin (15.97%) than 86.67% of its industry peers.
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 22.01%, HRB belongs to the best of the industry, outperforming 86.67% of the companies in the same industry.
In the last couple of years the Operating Margin of HRB has grown nicely.
HRB has a Gross Margin (44.53%) which is comparable to the rest of the industry.
HRB's Gross Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), HRB is creating value.
The number of shares outstanding for HRB has been reduced compared to 1 year ago.
The number of shares outstanding for HRB has been reduced compared to 5 years ago.
HRB has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.24 indicates that HRB is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 3.24, HRB is doing good in the industry, outperforming 73.33% of the companies in the same industry.
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.
Looking at the Debt to FCF ratio, with a value of 2.49, HRB is in the better half of the industry, outperforming 76.00% of the companies in the same industry.
A Debt/Equity ratio of 12.86 is on the high side and indicates that HRB has dependencies on debt financing.
With a Debt to Equity ratio value of 12.86, HRB is not doing good in the industry: 84.00% of the companies in the same industry are doing better.
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 | 3.24 |
ROIC/WACC4.17
WACC7.91%
2.3 Liquidity
A Current Ratio of 0.90 indicates that HRB may have some problems paying its short term obligations.
With a Current ratio value of 0.90, HRB is not doing good in the industry: 65.33% of the companies in the same industry are doing better.
A Quick Ratio of 0.90 indicates that HRB may have some problems paying its short term obligations.
HRB has a Quick ratio of 0.90. This is in the lower half of the industry: HRB underperforms 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
HRB shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.32%.
HRB shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 43.89% yearly.
The Revenue has decreased by -0.87% in the past year.
The Revenue has been growing slightly by 7.34% on average over the past years.
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
The Earnings Per Share is expected to grow by 12.47% on average over the next years. This is quite good.
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 Y5.25%
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
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
HRB is valuated reasonably with a Price/Earnings ratio of 10.90.
Based on the Price/Earnings ratio, HRB is valued cheaper than 88.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.86, HRB is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.35, the valuation of HRB can be described as very reasonable.
HRB's Price/Forward Earnings ratio is rather cheap when compared to the industry. HRB is cheaper than 92.00% of the companies 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 23.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.9 | ||
| Fwd PE | 10.35 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HRB is valued cheaply inside the industry as 82.67% of the companies are valued more expensively.
89.33% of the companies in the same industry are more expensive than HRB, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.58 | ||
| EV/EBITDA | 7.79 |
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.
HRB's earnings are expected to grow with 12.47% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.07
PEG (5Y)0.25
EPS Next 2Y7.99%
EPS Next 3Y12.47%
5. Dividend
5.1 Amount
HRB has a Yearly Dividend Yield of 3.40%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.94, HRB pays a better dividend. On top of this HRB pays more dividend than 98.67% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, HRB pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.4% |
5.2 History
The dividend of HRB is nicely growing with an annual growth rate of 6.79%!
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.
HRB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP32.86%
EPS Next 2Y7.99%
EPS Next 3Y12.47%
51.76
+0.62 (+1.21%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners95.26%
Inst Owner Change-5.09%
Ins Owners0.95%
Ins Owner Change2.79%
Market Cap6.93B
Analysts50.91
Price Target56.1 (8.38%)
Short Float %8.43%
Short Ratio6.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.4% |
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)-1.69%
EPS NQ rev (3m)0.55%
EPS NY rev (1m)-1.39%
EPS NY rev (3m)-3.79%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)1.3%
Revenue NY rev (1m)0.46%
Revenue NY rev (3m)1.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.9 | ||
| Fwd PE | 10.35 | ||
| P/S | 1.84 | ||
| P/FCF | 11.58 | ||
| P/OCF | 10.18 | ||
| P/B | 77.99 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.79 |
EPS(TTM)4.75
EY9.18%
EPS(NY)5
Fwd EY9.66%
FCF(TTM)4.47
FCFY8.64%
OCF(TTM)5.08
OCFY9.82%
SpS28.08
BVpS0.66
TBVpS-7.26
PEG (NY)2.07
PEG (5Y)0.25
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%
ROICexcg growth 3YN/A
ROICexcg 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 | 3.24 |
F-Score7
WACC7.91%
ROIC/WACC4.17
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%