H&R Block Inc. HRB reported first-quarter fiscal 2018 (ended Jul 31, 2017) adjusted loss from continuing operations of 62 cents per share, narrower than the Zacks Consensus Estimate of loss of 63 cents. Better-than-expected results were attributable to a rise in revenues during the quarter.
GAAP loss from continuing operations came in at 63 cents per share compared with 56 cents in the year-ago quarter.
Operational Performance
H&R Block reported revenues of $137.8 million in the fiscal first quarter compared with $125.2 million in the prior-year quarter. Revenues beat the Zacks Consensus Estimate of $130 million.
Total operating expenses increased 4.2% year over year to $323 million, due to higher occupancy, amortization, and compensation costs.
Financial Position
H&R Block exited the quarter with cash and cash equivalents of $551.6 million compared with $306.9 million as of Jul 31, 2016. Total outstanding long-term debt was approximately $1,493 million.
For the fiscal first quarter, net cash used for operating activities was $409.1 million, compared with $458 in the year-ago quarter.
Dividend
The board of directors declared a quarterly dividend of 24 cents per share, payable on Oct 2 to shareholders on record as of Sep 13. The company has been paying quarterly dividends to its shareholders since the company went public in 1962.
Peer Performance
Intuit Inc. INTU reported stellar fourth-quarter fiscal 2017 results. The company reported non-GAAP income (excluding stock-based compensation, amortization and other one-time items) from continuing operations of 20 cents per share, surpassing the Zacks Consensus Estimate of 16 cents.
Zacks Rank & Stocks to Consider
H&R Block presently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the industry are Weight Watchers International, Inc. WTW and SP Plus Corporation SP. SP Plus carries a Zacks Rank #2 (Buy), while Weight Watchers sports a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
SP Plus has a long-term earnings growth expectation of 10%. It has an average forward PE of 22.5x.
Weight Watchers has a long-term earnings growth expectation of 15%. It has an average forward PE of 32.7x.
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