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Should Value Investors Buy H&R Block (HRB) Stock?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is H&R Block (HRB - Free Report) . HRB is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 14.12 right now. For comparison, its industry sports an average P/E of 15.31. HRB's Forward P/E has been as high as 14.68 and as low as 11.42, with a median of 13, all within the past year.

We should also highlight that HRB has a P/B ratio of 10.70. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 20.59. HRB's P/B has been as high as 29.25 and as low as -188.50, with a median of 10.07, over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that H&R Block is likely undervalued currently. And when considering the strength of its earnings outlook, HRB sticks out at as one of the market's strongest value stocks.


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