Here's Why H&R Block Stock is a Great Pick Right Now

H&R Block, Inc. HRB has performed exceptionally well in the past year and has the potential to sustain this momentum in the near term. Consequently, if you haven't taken advantage of its share price appreciation yet, it's time you add the stock to your portfolio.

What Makes HRB an Attractive Pick?

An Outperformer: A glimpse at this consumer services company's price trend reveals that the stock has had an impressive run over the past year. Shares of H&R Block have gained 61.8%, significantly outperforming the 18.3% rise of the industry it belongs to and the 27.3% rally of the Zacks S&P 500 composite.

H&R Block, Inc. Price

Northward Estimate Revisions: Two estimates for fiscal 2025 have moved north in the past 30 days versus no southward revision, reflecting analysts' confidence in the company. The Zacks Consensus Estimate for HRB's fiscal 2025 earnings has moved up nearly 6.7% in the past 30 days.

Strong Growth Prospects: The company has an expected long-term (three to five years) earnings per share growth rate of 12.5%. Its fiscal 2025 earnings are expected to improve 15.2% year over year.

Positive Earnings Surprise History: HRB has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in all the trailing four quarters, delivering an average earnings surprise of 10.8%.

Growth Factors: H&R Block has a five-year strategy called Block Horizons in place. The strategy is focused on using human expertise and technological infrastructure to drive innovation. It aims to build strong relationships with small businesses through Wave and Block Advisors, develop Emerald Card as a consumer-centric, mobile-first solution for the underbanked, and make taxation faster and more personalized by integrating human expertise with digital tools.

Block Horizons is expected to help the company earn sustainable revenues and operating profit growth, improve return on investments, and maintain a strong balance sheet and liquidity position.

We believe that the main drivers of the company's post-pandemic performance are the digital enablement of its business, client addition and retention in both Assisted and DIY, greater usage of AI, and machine learning for product improvement and expansion in small businesses.

Other Stocks to Consider

A couple of other top-ranked stocks from the broader Zacks Business Services sector are Genpact G and Jamf JAMF.

Genpact carries a Zacks Rank of 2 at present. It has a long-term earnings growth expectation of 8.4%.G delivered a trailing four-quarter earnings surprise of 6.9%, on average.

Jamf currently carries a Zacks Rank of 2. The company has a long-term earnings growth expectation of 57%. JAMF delivered a trailing four-quarter earnings surprise of 15.7%, on average.

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