H&R Block Beats on Both Top and Bottom Lines

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H&R Block (NYS: HRB) reported earnings on Dec. 6. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Oct. 31 (Q2), H&R Block beat expectations on revenues and exceeded expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded and GAAP loss per share dropped.


Margins grew across the board.

Revenue details
H&R Block tallied revenue of $137.3 million. The three analysts polled by S&P Capital IQ predicted a top line of $130.5 million on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $119.3 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at -$0.37. The seven earnings estimates compiled by S&P Capital IQ averaged -$0.40 per share. GAAP EPS were -$0.39 for Q2 compared to -$0.47 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 38.4%, 1,670 basis points better than the prior-year quarter. Operating margin was -103.2%, 5,540 basis points better than the prior-year quarter. Net margin was -76.7%, 4,210 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $679.7 million. On the bottom line, the average EPS estimate is $0.07.

Next year's average estimate for revenue is $2.95 billion. The average EPS estimate is $1.65.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 369 members out of 549 rating the stock outperform, and 180 members rating it underperform. Among 160 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 91 give H&R Block a green thumbs-up, and 69 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 $20.86.

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The article H&R Block Beats on Both Top and Bottom Lines originally appeared on Fool.com.

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. The Motley Fool has no positions in the stocks mentioned above. 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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