H&R Block: Barrington Research Maintains Outperform, PT Down to $62 from $70.

H&R Block: Barrington Research Maintains Outperform, PT Down to $62 from $70.

H&R Block (HRB) has received a mixed reception from analysts following its latest quarterly earnings report. While the tax preparation giant reported a 4.6% year-over-year increase in revenue to $1.11 billion for the quarter ended June 2025, adjusted earnings per share (EPS) fell short of expectations [2]. Despite the revenue growth, the company's stock has seen a slight decline, with shares returning -2.7% over the past month [2].

Barrington Research, however, has maintained its "Outperform" rating on H&R Block, but has revised its price target down to $62 from $70. The research firm cited the company's consistent dividend hikes and strong shareholder returns, but noted that the market's cautious outlook towards H&R Block's prospects is justified [1]. The company's dividend has been increased by 12% for the eighth consecutive year, and it has returned over $600 million to investors through dividends and buybacks in the latest quarter alone [1].

Looking ahead, H&R Block expects to generate between $3.875 billion and $3.895 billion in revenue for fiscal 2026, with adjusted EPS projected to be between $4.85 and $5.00 [3]. The company has also extended its credit facility for five years at $1.5 billion, securing favorable pricing that is expected to improve interest expense by more than $1 million annually [3].

However, the market's lukewarm reception to H&R Block's earnings report is a reminder of the challenges facing the tax preparation sector. Rising competition, evolving customer preferences, and potential regulatory shifts could pose significant headwinds for the company in the coming years. Despite these challenges, H&R Block's strong dividend and buyback policies continue to attract investors, but the market remains cautious about the company's growth prospects.

References:
[1] https://finimize.com/content/hr-block-raises-its-dividend-once-again-as-profits-climb
[2] https://finance.yahoo.com/news/compared-estimates-h-r-block-223002755.html
[3] https://seekingalpha.com/news/4484347-h-and-r-block-outlines-3_875b-3_895b-revenue-target-for-2026-amid-ceo-transition-and-small