H&R Block: Strong Rally, But The Buy Case Remains Intact

Philipp Brohl 827 Followers Follow Summary H&R Block has delivered a 70% total return in five months but is still at a reasonable 9x P/E. I maintain a more cautious 'buy' rating on HRB, given its double-digit EPS growth and undemanding forward multiple. Recent quarterly results erased AI concerns, with HRB posting revenue, EPS, and guidance beats; Q4 EPS reached $5.31. Despite momentum, I recommend waiting for a pullback before adding after the significant rally. Margarita-Young/iStock Editorial via Getty Images Since I first covered H&R Block ( HRB ), the stock has been rising sharply, generating a total return of 70% in just five months. In that analysis, the stock was trading at less than 6x P/E; now the This article was written by Philipp Brohl 827 Followers Follow Philipp is a seasoned value investor with nearly 20 years of experience in the field. He takes a global approach to investment opportunities, seeking out undervalued companies that offer a significant margin of safety, leading to attractive dividend yields and returns. While he does not limit his investments to specific sectors or countries, he focuses only on companies he thoroughly understands and can reasonably assess for future growth potential. Philipp is particularly enthusiastic when he identifies a company with a solid earnings track record trading at less than 8x free cash flow, which inspired his username: 8xfreecash. Analyst’s Disclosure: I/we have a beneficial long position in the shares of HRB either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.