H&R BLOCK INC (HRB)
US0936711052 - Common Stock
HRB gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 65 industry peers in the Diversified Consumer Services industry. While HRB has a great profitability rating, there are some minor concerns on its financial health. HRB may be a bit undervalued, certainly considering the very reasonable score on growth Finally HRB also has an excellent dividend rating. These ratings would make HRB suitable 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 4 of the past 5 years.
Each year in the past 5 years HRB had a positive operating cash flow.
1.2 Ratios
The Return On Assets of HRB (21.18%) is better than 95.31% of its industry peers.
With an excellent Return On Invested Capital value of 30.99%, HRB belongs to the best of the industry, outperforming 95.31% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HRB is significantly above the industry average of 15.00%.
The last Return On Invested Capital (30.99%) for HRB is above the 3 year average (27.02%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.18% | ||
| ROE | N/A | ||
| ROIC | 30.99% |
ROA(3y)16.91%
ROA(5y)12.67%
ROE(3y)714.41%
ROE(5y)441.9%
ROIC(3y)27.02%
ROIC(5y)21.31%
1.3 Margins
With an excellent Profit Margin value of 16.86%, HRB belongs to the best of the industry, outperforming 93.75% of the companies in the same industry.
In the last couple of years the Profit Margin of HRB has declined.
HRB's Operating Margin of 21.99% is amongst the best of the industry. HRB outperforms 87.50% of its industry peers.
HRB's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 44.86%, HRB is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
HRB's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.99% | ||
| PM (TTM) | 16.86% | ||
| GM | 44.86% |
OM growth 3Y45.95%
OM growth 5Y-1.96%
PM growth 3YN/A
PM growth 5Y-3.88%
GM growth 3Y8.28%
GM growth 5Y-0.15%
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.
The debt/assets ratio for HRB is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.91 indicates that HRB is not a great score, but indicates only limited risk for bankruptcy at the moment.
HRB's Altman-Z score of 2.91 is fine compared to the rest of the industry. HRB outperforms 73.44% of its industry peers.
The Debt to FCF ratio of HRB is 3.82, which is a good value as it means it would take HRB, 3.82 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 3.82, HRB is doing good in the industry, outperforming 71.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.82 | ||
| Altman-Z | 2.91 |
ROIC/WACC3.54
WACC8.76%
2.3 Liquidity
A Current Ratio of 1.21 indicates that HRB should not have too much problems paying its short term obligations.
HRB has a Current ratio (1.21) which is in line with its industry peers.
HRB has a Quick Ratio of 1.21. This is a normal value and indicates that HRB is financially healthy and should not expect problems in meeting its short term obligations.
HRB has a Quick ratio of 1.21. This is comparable to the rest of the industry: HRB outperforms 53.13% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.21 |
3. Growth
3.1 Past
HRB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 23.58%, which is quite impressive.
Measured over the past 5 years, HRB shows a small growth in Earnings Per Share. The EPS has been growing by 5.76% on average per year.
HRB shows a small growth in Revenue. In the last year, the Revenue has grown by 0.88%.
Measured over the past years, HRB shows a small growth in Revenue. The Revenue has been growing by 1.90% on average per year.
EPS 1Y (TTM)23.58%
EPS 3Y71.59%
EPS 5Y5.76%
EPS growth Q2Q7.3%
Revenue 1Y (TTM)0.88%
Revenue growth 3Y9.57%
Revenue growth 5Y1.9%
Revenue growth Q2Q7.62%
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 10.74% yearly.
HRB is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.88% yearly.
EPS Next Y10.09%
EPS Next 2Y9.82%
EPS Next 3Y10.74%
EPS Next 5YN/A
Revenue Next Year2.9%
Revenue Next 2Y2.65%
Revenue Next 3Y1.88%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.82, 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 81.25% of the companies in the same industry.
HRB's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.20.
The Price/Forward Earnings ratio is 9.90, which indicates a very decent valuation of HRB.
90.63% of the companies in the same industry are more expensive than HRB, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.63. HRB is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.82 | ||
| Fwd PE | 9.9 |
4.2 Price Multiples
73.44% of the companies in the same industry are more expensive than HRB, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HRB indicates a rather cheap valuation: HRB is cheaper than 85.94% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.82 | ||
| EV/EBITDA | 9.5 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
HRB has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.17
PEG (5Y)2.05
EPS Next 2Y9.82%
EPS Next 3Y10.74%
5. Dividend
5.1 Amount
HRB has a Yearly Dividend Yield of 2.75%.
Compared to an average industry Dividend Yield of 23.95, HRB pays a better dividend. On top of this HRB pays more dividend than 95.31% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.44, HRB has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.75% |
5.2 History
The dividend of HRB has a limited annual growth rate of 3.85%.
HRB has paid a dividend for at least 10 years, which is 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)3.85%
Div Incr Years8
Div Non Decr Years17
5.3 Sustainability
30.36% of the earnings are spent on dividend by HRB. This is a low number and sustainable payout ratio.
The dividend of HRB is growing, but earnings are growing more, so the dividend growth is sustainable.
DP30.36%
EPS Next 2Y9.82%
EPS Next 3Y10.74%
H&R BLOCK INC
NYSE:HRB (4/26/2024, 10:19:04 AM)
46.455
-0.19 (-0.4%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap6.48B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.75% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.82 | ||
| Fwd PE | 9.9 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.17
PEG (5Y)2.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.18% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 21.99% | ||
| PM (TTM) | 16.86% | ||
| GM | 44.86% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.21 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)23.58%
EPS 3Y71.59%
EPS 5Y
EPS growth Q2Q
EPS Next Y10.09%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0.88%
Revenue growth 3Y9.57%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y