Why H&R Block’s Q3 Was So Underwhelming
H&R Block stock tumbled early Friday after the release of disappointing fiscal third-quarter earnings late on Thursday.
When H&R Block Inc. (NYSE: HRB) released its fiscal third-quarter financial results after the markets closed on Thursday, the firm said that it had a net loss of $0.59 per share and $519.2 million in revenue. That compared with consensus estimates of $0.55 in earnings per share and $485.6 million in revenue, as well as the $0.52 per share in earnings on revenue of $468.4 million posted in the same period of last year.
Overall, revenues increased 11% year over year due to improved tax return volumes in both Assisted and DIY, as well as revenues from acquired franchises and Wave.
The board previously announced that a quarterly cash dividend of $0.26 per share is payable on April 1 to shareholders of record as of March 17.
During the most recent quarter, the company repurchased 2.8 million shares at an aggregate price of $66 million, bringing total repurchases for the year to 10.1 million shares at an aggregate price of $247 million.
The company did not issue any guidance in the report. However, consensus estimates call for $4.55 in earnings per share (EPS) and $2.37 billion in revenue for the fiscal fourth quarter.
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Jeff Jones, H&R Block’s president and CEO, commented:
We’re making progress on our strategy to transform our business by connecting human expertise with technology to drive transparency and value for consumers and small business owners. We’re seeing the positive results of these efforts in our Assisted business and will apply learnings from the first half to deliver on our outlook for the fiscal year.
H&R Block stock traded down almost 9% at $19.00 early Thursday. The 52-week range now is $17.61 to $29.62. The consensus price target is $24.33.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
