H&R Block (NYSE:HRB) Trading Down 4.9% Following Weak Earnings

Key Points

• H&R Block's share price dropped 4.9% on Tuesday, trading as low as $52.21 and closing at $51.78, with a significant decrease in trading volume.
• Wall Street analysts have varied opinions, with Barrington Research maintaining an "outperform" rating and a price target of $70, while Goldman Sachs has a "sell" rating and a price objective of $54.
• Approximately 90.14% of H&R Block's stock is held by hedge funds and institutional investors, indicating strong institutional interest in the company.

H&R Block, Inc. (NYSE:HRB - Get Free Report)'s stock price dropped 4.9% during mid-day trading on Tuesday after the company announced weaker than expected quarterly earnings. The company traded as low as $52.21 and last traded at $51.78. Approximately 745,550 shares were traded during trading, a decline of 47% from the average daily volume of 1,415,538 shares. The stock had previously closed at $54.45.

The company reported $2.27 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $2.81 by ($0.54). H&R Block had a negative return on equity of 191.38% and a net margin of 16.11%. The business had revenue of $1.11 billion during the quarter, compared to the consensus estimate of $1.07 billion. During the same quarter in the previous year, the business posted $1.89 earnings per share. The company's quarterly revenue was up 4.6% compared to the same quarter last year.

H&R Block Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Monday, October 6th. Stockholders of record on Thursday, September 4th will be given a $0.42 dividend. This represents a $1.68 dividend on an annualized basis and a dividend yield of 3.3%. The ex-dividend date is Thursday, September 4th. This is an increase from H&R Block's previous quarterly dividend of $0.38. H&R Block's payout ratio is 33.56%.

Analysts Set New Price Targets

Several analysts recently weighed in on HRB shares. Barrington Research cut their price objective on shares of H&R Block from $70.00 to $62.00 and set an "outperform" rating on the stock in a research report on Wednesday. Wall Street Zen upgraded shares of H&R Block from a "hold" rating to a "buy" rating in a research report on Friday, May 9th. Northcoast Research downgraded shares of H&R Block from a "buy" rating to a "neutral" rating in a research report on Friday, May 2nd. Finally, The Goldman Sachs Group dropped their price target on shares of H&R Block from $54.00 to $48.00 and set a "sell" rating on the stock in a research report on Wednesday.

Institutional Investors Weigh In On H&R Block

A number of large investors have recently made changes to their positions in the company. SVB Wealth LLC acquired a new position in H&R Block in the 1st quarter valued at approximately $26,000. Operose Advisors LLC acquired a new position in shares of H&R Block during the 2nd quarter worth $27,000. Brooklyn Investment Group increased its stake in shares of H&R Block by 72.1% during the 1st quarter. Brooklyn Investment Group now owns 513 shares of the company's stock worth $28,000 after purchasing an additional 215 shares during the last quarter. Signaturefd LLC boosted its holdings in H&R Block by 40.0% during the second quarter. Signaturefd LLC now owns 651 shares of the company's stock valued at $36,000 after acquiring an additional 186 shares during the period. Finally, Bogart Wealth LLC boosted its holdings in H&R Block by 42.9% during the first quarter. Bogart Wealth LLC now owns 666 shares of the company's stock valued at $37,000 after acquiring an additional 200 shares during the period. Institutional investors and hedge funds own 90.14% of the company's stock.

H&R Block Price Performance

The company has a debt-to-equity ratio of 12.86, a current ratio of 0.90 and a quick ratio of 0.78. The stock's fifty day simple moving average is $54.94 and its 200-day simple moving average is $55.69. The company has a market capitalization of $6.71 billion, a P/E ratio of 11.22, a PEG ratio of 0.81 and a beta of 0.24.

H&R Block Company Profile

H&R Block, Inc engages in the provision of tax return preparation solutions, financial products and small business solutions. The company was founded by Henry W. Bloch and Richard A. Bloch on January 25, 1955, and is headquartered in Kansas City, MO.