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H&R Block Stock Rises 27% in a Year: What You Should Know

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H&R Block, Inc. (HRB - Free Report) has had an impressive run over the past year. The stock has appreciated a whopping 27%, significantly outperforming the 15% rally of the industry.

What’s Behind HRB’s Rally

H&R Block’s focus on providing essential services like tax preparation and financial advice ensures its relevance even during economic downturns. This stability appeals to investors seeking defensiveness in their portfolios.

HRB has recorded better-than-expected earnings and revenue performance in the past four quarters, driven by improvements in net average charge in both Assisted and DIY, company-owned tax return volume growth, and disciplined cost management.

We believe that the main drivers of the company’s post-pandemic performance are digital enablement of its business, client addition and retention in both Assisted and DIY, greater usage of AI, and machine learning for product improvement and expansion in small businesses.

Commitment to shareholder returns makes H&R Block a reliable way for investors to compound wealth over the long term. In fiscal 2024, 2023 and 2022, the company distributed dividends of $179.8 million, $177.9 million and $186.5 million, respectively. During the same periods, it bought back shares worth $350.1 million, $550.2 million and $563.2 million, respectively.

Zacks Rank and Other Stocks to Consider

HRB currently carries a Zacks Rank #2 (Buy).

A few other top-ranked stocks are Booz Allen Hamilton (BAH - Free Report) , Braze (BRZE - Free Report) , and DLocal Limited (DLO - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Booz Allen Hamilton has a long-term earnings growth expectation of 13.3%. BAH delivered a trailing four-quarter earnings surprise of 11.7%, on average.

Braze has a long-term earnings growth expectation of 30%. BRZE delivered a trailing four-quarter earnings surprise of 132.9%, on average.

DLocal Limited has a long-term earnings growth expectation of 7.3%. DLO delivered a trailing four-quarter earnings surprise of 22.6%, on average.

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