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Is H&R Block (HRB) Stock Undervalued Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is H&R Block (HRB - Free Report) . HRB is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 9.39, which compares to its industry's average of 16.33. Over the last 12 months, HRB's Forward P/E has been as high as 14.59 and as low as 9.27, with a median of 12.17.

Investors will also notice that HRB has a PEG ratio of 0.94. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. HRB's PEG compares to its industry's average PEG of 1.39. Over the last 12 months, HRB's PEG has been as high as 1.46 and as low as 0.93, with a median of 1.22.

Finally, we should also recognize that HRB has a P/CF ratio of 8.11. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.19. Over the past year, HRB's P/CF has been as high as 10.15 and as low as 5.62, with a median of 8.28.

These are only a few of the key metrics included in H&R Block's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, HRB looks like an impressive value stock at the moment.


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