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Reasons Why Investors Should Retain H&R Block Stock for Now

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Key Takeaways

  • HRB has a Growth Score of A, with earnings projected to rise 6% in 2025 and 7.9% in 2026.
  • H&R Block revenue growth is driven by higher U.S. assisted tax volumes and rising net average charges.
  • H&R Block expands client engagement via Second Look, Spruc banking and AI-powered DIY tax tools.

H&R Block (HRB - Free Report) has a Growth Score of A, which condenses key financial metrics to reflect a fair sense of the quality and sustainability of its growth.

The company’s earnings are expected to increase 6% in 2025 and 7.9% in 2026 year over year, while revenues are expected to grow 3.3% in 2025 and 2.4% in 2026.

Factors That Augur Well for HRB

H&R Block’s revenue growth is being driven by higher volume in U.S. assisted tax preparation due to an increase in net average charge (NAC) and higher company-owned tax return volumes. Increased service fees resulted in the company generating $204 million in total revenues in the first quarter of fiscal 2026, representing 5% year-over-year growth. Its unique Second Look offering, which reviews a new client’s past three years' tax returns to identify any missed refund opportunities, is boosting customer relationships.

HRB’s mobile banking platform, Spruc, supports year-round financial wellness and plays a key role in elevating client experience. Since its launch on June 30, 2024, the platform has recorded around 476,000 sign-ups and held $1.75 billion in customer deposits by the end of fiscal 2025.

The company’s integration of AI-powered technology into DIY (Do It Yourself) tax preparation tools like MyBlock, AI TaxAssist and TaxProReview enhances customer experience by assisting paid DIY online returns without extra charges.

Key Risk Factor

HRB reported a current ratio of 0.76, lower than the industry's average of 0.82 in the first quarter of fiscal 2026. A current ratio below 1 suggests that a company may not be well-positioned to meet its short-term obligations.

Zacks Rank & Stocks to Consider

H&R Block currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

A couple of better-ranked stocks in the broader Zacks Business Services sector are Genpact (G - Free Report)  and Palantir Technologies Inc. (PLTR - Free Report) .

Genpact carries a Zacks Rank #2 (Buy) at present. G has a long-term earnings growth expectation of 9.6%. The company delivered a trailing four-quarter earnings surprise of 5.5% on average.

Palantir Technologies also holds a Zacks Rank of 2 at present, with a long-term earnings growth expectation of 50%. The company beat earnings estimates in three of the last four quarters and matched once, with an earnings surprise of 16.3% on average.


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H&R Block, Inc. (HRB) - free report >>

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