H&R Block (HRB): Raising PT After Earnings - BMO
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BMO Capital analyst, Jeffrey Silber, reiterated his Market Perform rating on shares of H&R Block (NYSE: HRB) after the company reported FY1Q17 adjusted EPS of $(0.55) vs. $(0.35), roughly in line with the consensus. Much of the annual variance was due to changes from the H&R Block Bank divestiture (September 2015), which reduced certain revenue streams (e.g., investment income), while cost cuts were mostly offset by additional amortization and rent expense from prior franchise repurchases.
After studying last season's results, management stated the sluggish performance was a new client issue, as retention was relatively stable. Job one is to arrest the total client decline, per management.
The analyst stated "Given this is a seasonally light quarter, it's tough to read much from FY1Q17 results, in our view. Management did note the the majority of its planned cost reductions will occur after FY1Q17, and it remains laser-focused on executing a successful tax season."
Looking through the messy quarter, the analyst raised his price target to $24 from $23.
Shares of H&R Block closed at $24.20 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst PT Change
Related EntitiesBMO Capital, Earnings
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