Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

H&R Block Shares Stumble After ‘Tough To Read’ Q1 Report

Courtesy of Benzinga.

H & R Block Inc (NYSE: HRB) reported fiscal first-quarter results Tuesday, showing a 10 percent increase in revenues to $138 million and a wider loss of 62 cents per share. The results, however, were ahead of expectations.

The company indicated it typically reports a loss in the first quarter due to the seasonality of its tax business. The company also announced the appointment of Jeff Jones as president and CEO, effective October 9.

BMO Capital Markets said it wouldn’t read much into these results, given that fiscal year first quarter is a seasonally light quarter. The firm has a Market Perform rating on shares and a $31 price target.

At last check, H&R Block shares were tumbling 6 percent to $27.35.

Analyst Jeffrey Silber noted that revenues grew at a faster pace than that of operating expenses. The analyst also said the management plans to provide more details on the company’s 2018 outlook with the FQ2 results, with no Investor Day planned for the year. Management remains laser focused on its long-term client growth goal, the analyst added.

See Also: Intuit: Making Tax Accounting Sexy

Consequently, BMO Capital Markets believes promotional levels will continue this year. The firm said it’s adjusting its earnings per share estimates slightly, raising the 2018 estimate to $2.04 but maintaining the 2019 estimate unchanged at $2.24.

The firm attributed the post-earnings weakness of the shares to the wider loss the company reported, although it did suggest the widening was due to a lower share count.

BMO Capital Markets pointed to the negative secular trends in the tax preparation industry, which is seeing a shift to do-it-yourself mode. That said, the firm thinks a revised strategy could spur a turnaround, although it believes it would take some time to get there.

Latest Ratings for HRB

Date Firm Action From To
Aug 2017 Credit Suisse Maintains Neutral
Nov 2016 BTIG Research Downgrades Neutral Sell
Nov 2016 Morgan Stanley Downgrades Overweight Equal-Weight

View More Analyst Ratings for HRB


View the Latest Analyst Ratings

Posted-In: BMO Capital Markets Jeffrey SilberAnalyst Color Reiteration Analyst Ratings


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!