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Here's Why H&R Block (HRB) Stock is a Great Pick Right Now
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H&R Block, Inc. (HRB - Free Report) has performed exceptionally well in the past year and has the potential to sustain this momentum in the near term. Consequently, if you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
What Makes HRB an Attractive Pick?
An Outperformer: A glimpse at this consumer services company’s price trend reveals that the stock has had an impressive run over the past year. Shares of H&R Block have gained 83.6%, outperforming the 30% rise of the industry it belongs to and 28.6% rally of the Zacks S&P 500 composite.
Solid Rank and VGM Score: H&R Block has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors. Thus, the company is a compelling investment proposition at the moment.
Northward Estimate Revisions: Two estimates for fiscal 2024 have moved north in the past 30 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for HRB’s fiscal 2024 earnings has moved up nearly 1% in the past 30 days.
Strong Growth Prospects: The company has an expected long-term (three to five years) earnings per share growth rate of 12.5%. Its fiscal 2024 and 2025 earnings are expected to improve 12.3% and 10.3%, respectively, year over year.
Positive Earnings Surprise History: HRB has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in all the trailing four quarters, delivering an average earnings surprise of 10.3%.
Growth Factors: H&R Block has a five-year strategy called Block Horizons in place. The strategy is focused on using human expertise and technological infrastructure to drive innovation. It aims to build strong relationships with small businesses through Wave and Block Advisors, develop Emerald Card as a consumer-centric, mobile-first solution for the underbanked, and make taxation faster and more personalized by integrating human expertise with digital tools.
Block Horizons is expected to help the company earn sustainable revenues and operating profit growth, improve return on investments, and maintain a strong balance sheet and liquidity position.
We believe that the main drivers of the company’s post-pandemic performance are the digital enablement of its business, client addition and retention in both Assisted and DIY, greater usage of AI, machine learning for product improvement, and expansion in small businesses.
WU has a long-term earnings growth expectation of 3.9%. Western Union delivered a trailing four-quarter earnings surprise of 15.7%, on average.
NU currently has a Zacks Rank of 2. It has a long-term earnings growth expectation of 52.4%. Nu delivered a trailing four-quarter earnings surprise of 14%, on average.
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Here's Why H&R Block (HRB) Stock is a Great Pick Right Now
H&R Block, Inc. (HRB - Free Report) has performed exceptionally well in the past year and has the potential to sustain this momentum in the near term. Consequently, if you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
What Makes HRB an Attractive Pick?
An Outperformer: A glimpse at this consumer services company’s price trend reveals that the stock has had an impressive run over the past year. Shares of H&R Block have gained 83.6%, outperforming the 30% rise of the industry it belongs to and 28.6% rally of the Zacks S&P 500 composite.
H&R Block, Inc. Price
H&R Block, Inc. price | H&R Block, Inc. Quote
Solid Rank and VGM Score: H&R Block has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors. Thus, the company is a compelling investment proposition at the moment.
Northward Estimate Revisions: Two estimates for fiscal 2024 have moved north in the past 30 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for HRB’s fiscal 2024 earnings has moved up nearly 1% in the past 30 days.
Strong Growth Prospects: The company has an expected long-term (three to five years) earnings per share growth rate of 12.5%. Its fiscal 2024 and 2025 earnings are expected to improve 12.3% and 10.3%, respectively, year over year.
Positive Earnings Surprise History: HRB has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in all the trailing four quarters, delivering an average earnings surprise of 10.3%.
Growth Factors: H&R Block has a five-year strategy called Block Horizons in place. The strategy is focused on using human expertise and technological infrastructure to drive innovation. It aims to build strong relationships with small businesses through Wave and Block Advisors, develop Emerald Card as a consumer-centric, mobile-first solution for the underbanked, and make taxation faster and more personalized by integrating human expertise with digital tools.
Block Horizons is expected to help the company earn sustainable revenues and operating profit growth, improve return on investments, and maintain a strong balance sheet and liquidity position.
We believe that the main drivers of the company’s post-pandemic performance are the digital enablement of its business, client addition and retention in both Assisted and DIY, greater usage of AI, machine learning for product improvement, and expansion in small businesses.
Other Stocks to Consider
Some other top-ranked stocks in the broader Zacks Business Services sector are Western Union (WU - Free Report) and Nu (NU - Free Report) .
Western Union (WU - Free Report) sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
WU has a long-term earnings growth expectation of 3.9%. Western Union delivered a trailing four-quarter earnings surprise of 15.7%, on average.
NU currently has a Zacks Rank of 2. It has a long-term earnings growth expectation of 52.4%. Nu delivered a trailing four-quarter earnings surprise of 14%, on average.