Head-To-Head Comparison: Franchise Group (NASDAQ:FRGA) & H & R Block (NASDAQ:HRB)

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Franchise Group (NASDAQ:FRGA) and H & R Block (NYSE:HRB) are both consumer cyclical companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, profitability, risk, institutional ownership, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current ratings for Franchise Group and H & R Block, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Franchise Group 0 0 0 0 N/A
H & R Block 1 2 1 0 2.00

H & R Block has a consensus price target of $26.67, indicating a potential upside of 12.85%. Given H & R Block’s higher probable upside, analysts plainly believe H & R Block is more favorable than Franchise Group.

Earnings and Valuation

This table compares Franchise Group and H & R Block’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Franchise Group N/A N/A N/A N/A N/A
H & R Block $3.09 billion 1.53 $422.51 million $2.15 10.99

H & R Block has higher revenue and earnings than Franchise Group.

Dividends

H & R Block pays an annual dividend of $1.04 per share and has a dividend yield of 4.4%. Franchise Group does not pay a dividend. H & R Block pays out 48.4% of its earnings in the form of a dividend. H & R Block has increased its dividend for 3 consecutive years.

Profitability

This table compares Franchise Group and H & R Block’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Franchise Group N/A N/A N/A
H & R Block 13.71% 305.29% 15.99%

Summary

H & R Block beats Franchise Group on 8 of the 9 factors compared between the two stocks.

About Franchise Group

Franchise Group, Inc., through its subsidiaries, provides tax preparation services in the United States and Canada. The company also facilitates refund-based tax settlement financial products, such as refund transfer products and personal income tax refund discounting, as well as provides an online digital Do-It-Yourself tax program in the United States. The company offers its products and services through a network of company-owned offices and franchised locations under the Liberty Tax, Liberty Tax Service, Liberty Income Tax, Liberty Canada, and SiempreTax+ brand names. The company was formerly known as Liberty Tax, Inc., and changed its name to Franchise Group, Inc. in September 2019. Franchise Group, Inc. was founded in 1996 and is headquartered in Virginia Beach, Virginia.

About H & R Block

H&R Block, Inc., through its subsidiaries, provides assisted income tax return preparation, digital do-it-yourself (DIY) tax solutions, and other services and products related to income tax return preparation to the general public primarily in the United States, Canada, and Australia. The company offers assisted income tax return preparation and related services through a system of retail offices operated directly by the company or by franchisees. It also develops and markets DIY income tax preparation software online, as well as through third-party retail stores and direct mail; and provides DIY tax services, including preparation of federal and state income tax returns, access to tax tips, advice and tax-related news, use of calculators for tax planning, and error checking and electronic filing. In addition, the company develops and offers applications for mobile devices, which offer tax return preparation solutions and related services and products. Further, it provides refund transfers, H&R Block Emerald Advance lines of credit, H&R Block Emerald Prepaid MasterCard, Peace of Mind Extended Service Plan, Tax Identity Shield, and refund advance loans; POM, an Instant Cash Back refund option; and H&R Block Pay with Refund option. H&R Block, Inc. was founded in 1946 and is headquartered in Kansas City, Missouri.

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