Operating Margin - H & R Block Inc (NYSE:HRB)

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Price: 42.86 USD -1.04%

Market Cap: 5.4B USD

22.5%

Current

20%

Average

6.6%

Industry

Operating Margin represents how efficiently a company is able to generate profit through its core operations.

Higher ratios are generally better, illustrating the company is efficient in its operations and is good at turning sales into profits.

Operating Margin

22.5%

Operating Profit

849.3m

Revenue

3.8B

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
US		H & R Block Inc NYSE:HRB	5.5B USD	23%
PH	G	Golden MV Holdings Inc XPHS:HVN	1.5T PHP	39%
AU		Slater & Gordon Ltd ASX:SGH	18.7B AUD	13%
US		Service Corporation International NYSE:SCI	11B USD	23%
US		ADT Inc NYSE:ADT	6.7B USD	25%
US	S	StubHub Holdings Inc NYSE:STUB	4.8B USD	-102%
US		Frontdoor Inc NASDAQ:FTDR	4B USD	21%
BS		Onespaworld Holdings Ltd NASDAQ:OSW	2.1B USD	9%
US		Pinelawn Cemetery OTC:PLWN	2B USD	N/A
IN		Urban Company Ltd NSE:URBANCO	177B INR	-6%
US		Mister Car Wash Inc NYSE:MCW	1.8B USD	19%

H & R Block Inc
Glance View

Economic Moat

None

Market Cap

5.4B USD

Industry

Diversified Consumer Services

In the bustling world of financial services, H & R Block Inc. has carved out a distinctive niche for itself, leveraging the perennial necessity of tax preparation and related services. Originally founded by brothers Henry and Richard Bloch in 1955, the company emerged as a pioneering force in bringing accessible tax preparation to the masses. H & R Block thrived by transforming the intricate, often overwhelming task of tax filing into a manageable, even straightforward process for individuals and small businesses. Through its extensive network of retail tax offices, complemented by a robust digital presence, the company enables customers to navigate the often-complex terrain of tax code with relative ease. This dual approach not only caters to a diverse clientele but also offers flexibility and choice in a predominantly customer-centric market. The financial bedrock of H & R Block lies in the fees for its tax preparation services, whether conducted in-person by its cadre of trained professionals or through its online and software solutions. Such fees are typically straightforward, often charging by the form or task, appealing to a broad demographic by providing transparency and predictability. Additionally, H & R Block extends its expertise beyond mere tax returns, offering ancillary services such as tax planning, bookkeeping, and even business consulting, diversifying its revenue streams and reinforcing its role as a comprehensive financial ally. By continuously adapting to changes in tax legislation and integrating digital advancements, the company remains a resilient and relevant player, sustaining its business model through both stability and innovation in a domain that touches every earning individual and entity.

View HRB Analysis

HRB Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

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US	Berkshire Hathaway Inc NYSE:BRK.A	Financial Services
US	Bank of America Corp NYSE:BAC	Banking
US	Mastercard Inc NYSE:MA	Technology
US	UnitedHealth Group Inc NYSE:UNH	Health Care
US	Exxon Mobil Corp NYSE:XOM	Energy
US	Pfizer Inc NYSE:PFE	Pharmaceuticals
US	Palantir Technologies Inc NYSE:PLTR	Technology
US	Nike Inc NYSE:NKE	Textiles, Apparel & Luxury Goods
US	Visa Inc NYSE:V	Technology
CN	Alibaba Group Holding Ltd NYSE:BABA	Retail
US	JPMorgan Chase & Co NYSE:JPM	Banking
US	Coca-Cola Co NYSE:KO	Beverages
US	Walmart Inc NYSE:WMT	Retail
US	Verizon Communications Inc NYSE:VZ	Telecommunication
US	Chevron Corp NYSE:CVX	Energy

	Johnson & Johnson NYSE:JNJ	US
	Berkshire Hathaway Inc NYSE:BRK.A	US
	Bank of America Corp NYSE:BAC	US
	Mastercard Inc NYSE:MA	US
	UnitedHealth Group Inc NYSE:UNH	US
	Exxon Mobil Corp NYSE:XOM	US
	Pfizer Inc NYSE:PFE	US
	Palantir Technologies Inc NYSE:PLTR	US
	Nike Inc NYSE:NKE	US
	Visa Inc NYSE:V	US
	Alibaba Group Holding Ltd NYSE:BABA	CN
	JPMorgan Chase & Co NYSE:JPM	US
	Coca-Cola Co NYSE:KO	US
	Walmart Inc NYSE:WMT	US
	Verizon Communications Inc NYSE:VZ	US
	Chevron Corp NYSE:CVX	US

	Johnson & Johnson NYSE:JNJ	214.2786 USD 1.28%
	Berkshire Hathaway Inc NYSE:BRK.A	754 677.36 USD 0.77%
	Bank of America Corp NYSE:BAC	55.4926 USD 0.64%
	Mastercard Inc NYSE:MA	570.77 USD -0.2%
	UnitedHealth Group Inc NYSE:UNH	339.2875 USD -0.75%
	Exxon Mobil Corp NYSE:XOM	117.34 USD -1.25%

	Franklin Covey Co NYSE:FC	16.36 USD -1.62%
	Mohawk Industries Inc NYSE:MHK	110.905 USD -1.41%
	Ardmore Shipping Corp NYSE:ASC	11.23 USD 0.81%
	ASGN Inc NYSE:ASGN	47.585 USD -1.01%
	Skyworks Solutions Inc NASDAQ:SWKS	66.78 USD -0.28%
	Weatherford International PLC NASDAQ:WFRD	79.445 USD -1.11%

	Johnson & Johnson NYSE:JNJ	214.2786 USD 1.28%
	Bank of America Corp NYSE:BAC	55.4926 USD 0.64%
	Mastercard Inc NYSE:MA	570.77 USD -0.2%
	Salesforce Inc NYSE:CRM	254.21 USD -3.06%
	Abbvie Inc NYSE:ABBV	228.04 USD 2.11%
	Home Depot Inc NYSE:HD	359.25 USD -0.11%

H & R Block Inc
NYSE:HRB