H&R Block (HRB) AI Stock Analysis

• Market Cap: $5.56B
• Dividend Yield: 3.67%
• Average Volume (3M): 1.64M
• Price to Earnings (P/E): 9.9
• Beta (1Y): 0.20
• Revenue Growth: 4.15%
• EPS Growth: 8.13%
• Country: US
• Employees: 4,200
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Personal Products & Services
• EPS (TTM): -1.20
• Shares Outstanding: 126,425,310
• 10 Day Avg. Volume: 1,487,091
• 30 Day Avg. Volume: 1,642,019
• PEG Ratio: 1.49
• Price to Book (P/B): 82.71
• Price to Sales (P/S): 1.95
• P/FCF Ratio: 12.28
• Enterprise Value/Market Cap: 1.53
• Enterprise Value/Revenue: 2.25
• Enterprise Value/Gross Profit: 4.80
• Enterprise Value/Ebitda: 8.54
• 1Y Price Target: $62.00
• Price Target Upside: 43.25% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 4.96
• Revenue Forecast (FY): $3.88B

• Rating: 63 Neutral
• Price Target: $49.00 ▲(13.22% Upside)

H&R Block's overall stock score is driven by strong financial performance and positive earnings call sentiment. However, the high leverage and negative equity on the balance sheet pose significant risks. The technical analysis indicates a bearish trend, but the stock's valuation suggests it may be undervalued, offering potential upside for investors.

Positive Factors

Revenue Growth

Consistent revenue growth and improved EBITDA indicate robust business expansion and effective cost management, enhancing long-term profitability.

Capital Return to Shareholders

Strong capital return strategy reflects solid cash generation and management's commitment to shareholder value, supporting long-term investor confidence.

Small Business and Wave Growth

Growth in small business services and high-margin products like Wave enhances revenue diversification and strengthens competitive positioning.

Negative Factors

High Leverage and Negative Equity

High leverage and negative equity pose financial stability risks, potentially limiting future investment and growth opportunities.

Net Loss from Continuing Operations

Persistent net losses highlight challenges in achieving profitability, which could impact long-term financial health and strategic initiatives.

Seasonal Business Impact

The seasonal nature of revenue generation leads to volatility in financial performance, complicating cash flow management and planning.

H&R Block Business Overview & Revenue Model

Company Description

H&R Block, Inc., through its subsidiaries, provides assisted income tax return preparation and do-it-yourself (DIY) tax return preparation services and products to the general public primarily in the United States, Canada, and Australia. The company offers assisted income tax return preparation and related services through a system of retail offices operated directly by the company or its franchisees. It also provides Refund Transfers and H&R Block Emerald Prepaid Mastercard, which enables clients to receive their tax refunds; Peace of Mind extended service plans; H&R Block Emerald Advance lines of credit; Tax Identity Shield that provides clients assistance in helping protect their tax identity and access to services to help restore their tax identity; refund advance loans; H&R Block Instant Refund; and H&R Block Pay With Refund services. In addition, the company offers small business financial solutions through its company-owned or franchise offices, and online. H&R Block, Inc. was founded in 1955 and is headquartered in Kansas City, Missouri.

How the Company Makes Money

H&R Block generates revenue primarily through its tax preparation services, which include both in-person and online filing options. The company charges clients a fee for preparing their federal and state tax returns, with pricing varying based on the complexity of the return. Key revenue streams include retail tax preparation, online tax software sales, and the sale of additional services such as refund anticipation loans and audit support. Additionally, H&R Block offers other financial services, including bookkeeping for small businesses and personal finance tools, which contribute to its earnings. The company also benefits from strategic partnerships, such as collaborations with financial institutions for offering tax-related financial products, further enhancing its revenue potential.

H&R Block Financial Statement Overview

Summary

H&R Block demonstrates strong revenue growth and profitability, but high leverage and negative equity raise concerns about financial stability. Cash flow generation is solid, supporting operational needs. The company should focus on improving its balance sheet health to mitigate potential risks.

Income Statement

H&R Block shows strong revenue growth with a TTM increase of 25.9%, indicating robust business expansion. The gross profit margin is healthy at 46.9%, and the net profit margin is solid at 16.2%. However, the EBIT and EBITDA margins are moderate, suggesting room for operational efficiency improvements.

Balance Sheet

The balance sheet reveals a concerning debt-to-equity ratio of -3.15 in the TTM, indicating high leverage and negative equity, which poses financial stability risks. The return on equity is negative, reflecting challenges in generating returns for shareholders. The equity ratio is not available due to negative equity, highlighting potential financial distress.

Cash Flow

Cash flow analysis shows a slight decline in free cash flow growth at -3.79% TTM, but the operating cash flow to net income ratio is strong at 1.36, indicating good cash generation relative to earnings. The free cash flow to net income ratio is also robust at 0.94, demonstrating effective cash management.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.77B	3.76B	3.61B	3.47B	3.46B	3.41B
Gross Profit	1.77B	1.67B	1.62B	1.55B	1.58B	1.57B
EBITDA	993.92M	976.34M	963.19M	914.69M	889.53M	932.46M
Net Income	612.53M	605.77M	595.32M	553.70M	553.67M	583.79M
Balance Sheet
Total Assets	2.62B	3.26B	3.22B	3.07B	3.27B	4.01B
Cash, Cash Equivalents and Short-Term Investments	376.41M	983.28M	1.05B	986.98M	885.01M	1.43B
Total Debt	2.25B	2.03B	1.96B	1.93B	1.92B	2.44B
Total Liabilities	3.17B	3.18B	3.13B	3.04B	3.06B	3.63B
Stockholders Equity	-550.91M	88.90M	90.59M	32.06M	211.63M	388.06M
Cash Flow
Free Cash Flow	576.14M	598.85M	657.18M	752.14M	746.58M	573.14M
Operating Cash Flow	652.63M	680.88M	720.86M	821.84M	808.54M	625.93M
Investing Cash Flow	-99.91M	-105.37M	-93.86M	-101.39M	-76.54M	-45.52M
Financing Cash Flow	-588.02M	-647.44M	-564.31M	-750.99M	-1.26B	-2.41B

H&R Block Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 43.28
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HRB, the sentiment is Neutral. The current price of 43.28 is above the 20-day moving average (MA) of 42.34, below the 50-day MA of 46.39, and below the 200-day MA of 51.91, indicating a neutral trend. The MACD of -0.71 indicates Negative momentum. The RSI at 46.51 is Neutral, neither overbought nor oversold. The STOCH value of 77.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HRB.

H&R Block Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FTDR	72 Outperform	$4.01B	16.14	91.16%	―	11.88%	18.08%
SCI	67 Neutral	$11.00B	21.17	33.48%	1.66%	3.41%	7.94%
BFAM	67 Neutral	$5.91B	29.79	14.19%	―	9.38%	74.27%
HRB	63 Neutral	$5.56B	9.87	―	3.67%	4.15%	8.13%
MCW	63 Neutral	$1.88B	20.55	8.84%	―	6.98%	22.81%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CSV	54 Neutral	$680.03M	13.88	21.96%	1.04%	0.99%	37.55%

H&R Block Corporate Events

H&R Block Shareholders Elect Directors at Annual Meeting

The 2025 annual meeting of H&R Block shareholders took place on November 5, 2025, where all nominated directors were elected to serve until the next annual meeting. Additionally, the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending June 30, 2026, was ratified, and the advisory proposal on executive compensation was approved.