H&R BLOCK INC (HRB) Stock Fundamental Analysis
NYSE:HRB - New York Stock Exchange, Inc. - US0936711052 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to HRB. HRB was compared to 72 industry peers in the Diversified Consumer Services industry. HRB scores excellent on profitability, but there are some minor concerns on its financial health. HRB has a bad growth rate and is valued cheaply. Finally 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
HRB had positive earnings in the past year.
In the past year HRB had a positive cash flow from operations.
Of the past 5 years HRB 4 years were profitable.
In the past 5 years HRB always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 17.23%, HRB belongs to the best of the industry, outperforming 95.83% of the companies in the same industry.
The Return On Invested Capital of HRB (38.40%) is better than 98.61% 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 10.94%.
The 3 year average ROIC (27.24%) for HRB is below the current ROIC(38.40%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.23% | ||
| ROE | N/A | ||
| ROIC | 38.4% |
ROA(3y)17.74%
ROA(5y)13.8%
ROE(3y)877.58%
ROE(5y)557.23%
ROIC(3y)27.24%
ROIC(5y)22.03%
1.3 Margins
Looking at the Profit Margin, with a value of 15.06%, HRB belongs to the top of the industry, outperforming 88.89% of the companies in the same industry.
HRB's Profit Margin has improved in the last couple of years.
HRB's Operating Margin of 21.75% is amongst the best of the industry. HRB outperforms 90.28% of its industry peers.
HRB's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 44.53%, HRB is in line with its industry, outperforming 51.39% of the companies in the same industry.
HRB's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.75% | ||
| PM (TTM) | 15.06% | ||
| GM | 44.53% |
OM growth 3Y-0.35%
OM growth 5Y2.31%
PM growth 3Y-1.2%
PM growth 5Y3.82%
GM growth 3Y-0.88%
GM growth 5Y0.73%
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.
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
HRB has an Altman-Z score of 3.05. This indicates that HRB is financially healthy and has little risk of bankruptcy at the moment.
HRB has a better Altman-Z score (3.05) than 68.06% of its industry peers.
HRB has a debt to FCF ratio of 2.30. This is a good value and a sign of high solvency as HRB would need 2.30 years to pay back of all of its debts.
HRB's Debt to FCF ratio of 2.30 is fine compared to the rest of the industry. HRB outperforms 77.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.3 | ||
| Altman-Z | 3.05 |
ROIC/WACC4.54
WACC8.45%
2.3 Liquidity
HRB has a Current Ratio of 0.78. 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 has a Current ratio of 0.78. This is in the lower half of the industry: HRB underperforms 65.28% of its industry peers.
HRB has a Quick Ratio of 0.78. This is a bad value and indicates that HRB is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.78, HRB is doing worse than 65.28% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.78 |
3. Growth
3.1 Past
The earnings per share for HRB have decreased by -6.42% in the last year.
Measured over the past years, HRB shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.54% on average per year.
Looking at the last year, HRB shows a decrease in Revenue. The Revenue has decreased by -1.36% in the last year.
Measured over the past years, HRB shows a small growth in Revenue. The Revenue has been growing by 3.13% on average per year.
EPS 1Y (TTM)-6.42%
EPS 3Y9.34%
EPS 5Y15.54%
EPS Q2Q%8.91%
Revenue 1Y (TTM)-1.36%
Revenue growth 3Y1.88%
Revenue growth 5Y3.13%
Sales Q2Q%4.22%
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 8.67% on average per year.
The Revenue is expected to grow by 2.91% on average over the next years.
EPS Next Y17.57%
EPS Next 2Y7.34%
EPS Next 3Y8.67%
EPS Next 5YN/A
Revenue Next Year4.18%
Revenue Next 2Y3.46%
Revenue Next 3Y2.91%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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
With a Price/Earnings ratio of 12.73, HRB is valued correctly.
HRB's Price/Earnings ratio is rather cheap when compared to the industry. HRB is cheaper than 87.50% 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 26.60.
With a Price/Forward Earnings ratio of 10.71, the valuation of HRB can be described as very reasonable.
Based on the Price/Forward Earnings ratio, HRB is valued cheaper than 93.06% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HRB to the average of the S&P500 Index (22.39), we can say HRB is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.73 | ||
| Fwd PE | 10.71 |
4.2 Price Multiples
HRB's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. HRB is cheaper than 75.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, HRB is valued cheaply inside the industry as 87.50% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.49 | ||
| EV/EBITDA | 8.89 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HRB has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.72
PEG (5Y)0.82
EPS Next 2Y7.34%
EPS Next 3Y8.67%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.60%, HRB has a reasonable but not impressive dividend return.
HRB's Dividend Yield is rather good when compared to the industry average which is at 4.17. HRB pays more dividend than 94.44% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, HRB has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.6% |
5.2 History
The dividend of HRB has a limited annual growth rate of 4.72%.
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)4.72%
Div Incr Years9
Div Non Decr Years27
5.3 Sustainability
HRB pays out 34.30% 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.
DP34.3%
EPS Next 2Y7.34%
EPS Next 3Y8.67%
NYSE:HRB (6/13/2025, 12:09:34 PM)
55.64
-0.43 (-0.77%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners95.74%
Inst Owner Change1.39%
Ins Owners1.14%
Ins Owner Change-1.79%
Market Cap7.45B
Analysts50.91
Price Target65.28 (17.33%)
Short Float %8.97%
Short Ratio6.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.6% |
Yearly Dividend1.26
Dividend Growth(5Y)4.72%
DP34.3%
Div Incr Years9
Div Non Decr Years27
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.26%
Min EPS beat(2)-7.56%
Max EPS beat(2)3.03%
EPS beat(4)3
Avg EPS beat(4)1.17%
Min EPS beat(4)-7.56%
Max EPS beat(4)7.39%
EPS beat(8)7
Avg EPS beat(8)5.69%
EPS beat(12)10
Avg EPS beat(12)5.9%
EPS beat(16)13
Avg EPS beat(16)7.76%
Revenue beat(2)1
Avg Revenue beat(2)-1.51%
Min Revenue beat(2)-3.34%
Max Revenue beat(2)0.31%
Revenue beat(4)3
Avg Revenue beat(4)0.3%
Min Revenue beat(4)-3.34%
Max Revenue beat(4)2.37%
Revenue beat(8)6
Avg Revenue beat(8)0.99%
Revenue beat(12)8
Avg Revenue beat(12)1.65%
Revenue beat(16)11
Avg Revenue beat(16)-2.11%
PT rev (1m)2.67%
PT rev (3m)2.67%
EPS NQ rev (1m)-4.95%
EPS NQ rev (3m)-4.95%
EPS NY rev (1m)-0.52%
EPS NY rev (3m)-0.52%
Revenue NQ rev (1m)-2.07%
Revenue NQ rev (3m)-2.07%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.73 | ||
| Fwd PE | 10.71 | ||
| P/S | 2.01 | ||
| P/FCF | 11.49 | ||
| P/OCF | 10.21 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.89 |
EPS(TTM)4.37
EY7.85%
EPS(NY)5.2
Fwd EY9.34%
FCF(TTM)4.84
FCFY8.7%
OCF(TTM)5.45
OCFY9.8%
SpS27.73
BVpS-1.44
TBVpS-9.33
PEG (NY)0.72
PEG (5Y)0.82
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.23% | ||
| ROE | N/A | ||
| ROCE | 48.79% | ||
| ROIC | 38.4% | ||
| ROICexc | 72.05% | ||
| ROICexgc | N/A | ||
| OM | 21.75% | ||
| PM (TTM) | 15.06% | ||
| GM | 44.53% | ||
| FCFM | 17.46% |
ROA(3y)17.74%
ROA(5y)13.8%
ROE(3y)877.58%
ROE(5y)557.23%
ROIC(3y)27.24%
ROIC(5y)22.03%
ROICexc(3y)49.03%
ROICexc(5y)40.5%
ROICexgc(3y)423.16%
ROICexgc(5y)N/A
ROCE(3y)34.61%
ROCE(5y)27.98%
ROICexcg growth 3Y48.94%
ROICexcg growth 5YN/A
ROICexc growth 3Y11.08%
ROICexc growth 5Y-2.4%
OM growth 3Y-0.35%
OM growth 5Y2.31%
PM growth 3Y-1.2%
PM growth 5Y3.82%
GM growth 3Y-0.88%
GM growth 5Y0.73%
F-Score7
Asset Turnover1.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.3 | ||
| Debt/EBITDA | 1.23 | ||
| Cap/Depr | 69.16% | ||
| Cap/Sales | 2.2% | ||
| Interest Coverage | 11.14 | ||
| Cash Conversion | 78.86% | ||
| Profit Quality | 115.93% | ||
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.78 | ||
| Altman-Z | 3.05 |
F-Score7
WACC8.45%
ROIC/WACC4.54
Cap/Depr(3y)49.77%
Cap/Depr(5y)46.23%
Cap/Sales(3y)1.85%
Cap/Sales(5y)2.04%
Profit Quality(3y)127.56%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-6.42%
EPS 3Y9.34%
EPS 5Y15.54%
EPS Q2Q%8.91%
EPS Next Y17.57%
EPS Next 2Y7.34%
EPS Next 3Y8.67%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.36%
Revenue growth 3Y1.88%
Revenue growth 5Y3.13%
Sales Q2Q%4.22%
Revenue Next Year4.18%
Revenue Next 2Y3.46%
Revenue Next 3Y2.91%
Revenue Next 5YN/A
EBIT growth 1Y29.28%
EBIT growth 3Y1.52%
EBIT growth 5Y5.51%
EBIT Next Year11.04%
EBIT Next 3Y5.84%
EBIT Next 5YN/A
FCF growth 1Y-25.3%
FCF growth 3Y4.67%
FCF growth 5Y5.16%
OCF growth 1Y-21.83%
OCF growth 3Y4.82%
OCF growth 5Y3.52%