Key insights
- The author believes H&R Block (HRB) is undervalued due to its low P/E ratio, high dividend yield, and ongoing share buybacks. The core tax season earnings are complete, and the author anticipates continued revenue growth and EPS improvement, making further share repurchases likely if the price declines. Inflation and geopolitical events are not expected to significantly impact the company.
HRB shouldn't be affected much by inflation or war, the most important earnings where they make all the money for the whole year has passed and they did fine. Rest of the earnings will be flat or lossing, as long as they don't miss huge. P/E will only keeps going down as the company continues to buy back shares...
P/E is already around 6, dividend at 4.7%... if the price go lower, the management will probably buy more shares as that's the easiest way to boost EPS, then the P/E will get even lower...
I just can't see anything wrong with it when revenue is going up, which has nothing to do with how many shares they have and that means people are still using the service or the company is still growing into other area (small business)