H&R Block Misses on the Top and Bottom Lines
H&R Block (NYS: HRB) reported earnings yesterday. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended Jan. 31 (Q3), H&R Block missed estimates on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP loss per share contracted.
Margins increased across the board.
H&R Block reported revenue of $663.3 million. The five analysts polled by S&P Capital IQ expected a top line of $722.5 million on the same basis. GAAP reported sales were 17% lower than the prior-year quarter's $795.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.01. The seven earnings estimates compiled by S&P Capital IQ predicted $0.09 per share. GAAP EPS were -$0.01 for Q3 compared to -$0.04 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 37.6%, 1,750 basis points better than the prior-year quarter. Operating margin was 3.0%, 960 basis points better than the prior-year quarter. Net margin was -0.5%, 110 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $2.15 billion. On the bottom line, the average EPS estimate is $2.20.
Next year's average estimate for revenue is $3.29 billion. The average EPS estimate is $1.48.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 379 members out of 560 rating the stock outperform, and 181 members rating it underperform. Among 174 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 91 give H&R Block a green thumbs-up, and 83 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on H&R Block is outperform, with an average price target of $19.00.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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