H&R BLOCK INC (HRB) Stock Fundamental Analysis
USA - NYSE:HRB - US0936711052 - Common Stock
51.33 USD
+0.12 (+0.23%)
51.33 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. While HRB has a great profitability rating, there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on HRB. HRB also has an excellent dividend rating. This makes HRB very considerable for value and dividend investing!
1. Profitability
1.1 Basic Checks
In the past year HRB was profitable.
HRB had a positive operating cash flow in the past year.
HRB had positive earnings in each of the past 5 years.
Each year in the past 5 years HRB had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 18.40%, HRB belongs to the top of the industry, outperforming 93.33% of the companies in the same industry.
HRB's Return On Equity of 675.51% is amongst the best of the industry. HRB outperforms 100.00% of its industry peers.
With an excellent Return On Invested Capital value of 32.95%, HRB belongs to the best of the industry, outperforming 98.67% 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 9.63%.
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's Profit Margin of 15.97% is amongst the best of the industry. HRB outperforms 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.
The Operating Margin of HRB (22.01%) is better than 86.67% of its industry peers.
In the last couple of years the Operating Margin of HRB has grown nicely.
With a Gross Margin value of 44.53%, HRB perfoms like the industry average, outperforming 46.67% of the companies in the same 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
HRB has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it 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 has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.18 indicates that HRB is not in any danger for bankruptcy at the moment.
The Altman-Z score of HRB (3.18) is better than 76.00% 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's Debt to FCF ratio of 2.49 is fine compared to the rest of the industry. HRB outperforms 74.67% of its industry peers.
HRB has a Debt/Equity ratio of 12.86. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of HRB (12.86) is worse than 84.00% of its industry peers.
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 | 3.18 |
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.
HRB has a worse Current ratio (0.90) than 65.33% 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 has a Quick ratio of 0.90. This is in the lower half of the industry: HRB underperforms 62.67% 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%.
The Earnings Per Share has been growing by 43.89% on average over the past years. This is a very strong growth
Looking at the last year, HRB shows a decrease in Revenue. The Revenue has decreased by -0.87% in the last year.
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)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.
The Revenue is expected to grow by 3.32% on average over the next years.
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 10.81.
HRB's Price/Earnings ratio is rather cheap when compared to the industry. HRB is cheaper than 86.67% 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 27.31.
Based on the Price/Forward Earnings ratio of 10.27, the valuation of HRB can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HRB indicates a rather cheap valuation: HRB is cheaper than 89.33% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.85, HRB is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.81 | ||
| Fwd PE | 10.27 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HRB is valued cheaper than 81.33% of the companies in the same industry.
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 | 10.96 | ||
| EV/EBITDA | 7.47 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates HRB does not grow enough to justify the current Price/Earnings ratio.
HRB has an outstanding profitability rating, which 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)2.06
PEG (5Y)0.25
EPS Next 2Y7.99%
EPS Next 3Y12.47%
5. Dividend
5.1 Amount
HRB has a Yearly Dividend Yield of 3.39%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.02, 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 2.40, HRB pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
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 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 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%
51.33
+0.12 (+0.23%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners95.26%
Inst Owner Change-0.59%
Ins Owners0.95%
Ins Owner Change2.79%
Market Cap6.56B
Analysts50.91
Price Target56.1 (9.29%)
Short Float %8.43%
Short Ratio6.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
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)-1.39%
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 | 10.81 | ||
| Fwd PE | 10.27 | ||
| P/S | 1.75 | ||
| P/FCF | 10.96 | ||
| P/OCF | 9.64 | ||
| P/B | 73.83 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.47 |
EPS(TTM)4.75
EY9.25%
EPS(NY)5
Fwd EY9.74%
FCF(TTM)4.68
FCFY9.12%
OCF(TTM)5.32
OCFY10.37%
SpS29.41
BVpS0.7
TBVpS-7.61
PEG (NY)2.06
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 | 3.18 |
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%