Earnings Preview: H&R Block
H&R Block (HRB) is expected to report Q1 earnings after market close Wednesday Sept. 3, with a conference call scheduled for 4:30 pm ET.
Guidance
Analysts are looking for a loss of (35c) on revenue of $378.3M. The consensus range is (44c) to (33c) for EPS, and revenue of $331.71M to $412.5M, according to First Call. In June, H&R Block forecast FY09 EPS $1.60 to $1.70 vs. First Call consensus of $1.66 and increased its annual dividend by 3c to 60c; in August, the company increased its quarterly dividend to 15c, a 5.3% increase.
Analyst Views
Zacks Research said that H&R Block's sale of H&R Block Financial Advisors, its financial advisory segment, was well received by the Street. While the $315M sale to Ameriprise Financial (AMP) is not expected to generate a material gain, it is likely to free up cash about $340M in cash. Soleil analyst Michael Millman believes that the sale is a "favorable development," as the unit has been a weak performer for "many years." Millman, who holds a Buy rating on the stock, believes management is now positioned to grow the basic business again. Oppenheimer's Scott Schneeberger says the sale of the unit is "yet another demonstration of shareholder value focus" from chairman Richard Breeden.
In July, H&R Block named Russ Smyth, the former president of McDonald's Europe (MCD) as its new CEO to replace interim CEO Alan Bennett.
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