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Sorry Donald Trump, Business Looks Bright at Tax Prep Firm H&R Block

9/03/15 2:35 PM EDT
Business just got better at tax preparation company H&R Block (HRB), which might be a disappointment for presidential hopeful Donald Trump. A few weeks ago, Trump declared that he dreamed of putting H&R Block out of business by simplifying the tax code. H&R Block however, is moving forward with a new capital structure plan, a big share buyback for its stockholders, and improved financial results. H&R Block shares got a big midweek boost on word of a $3.5-billion share buyback plan. The company announced the buyback following the divestiture of its banking business, H&R Block, to BofI Federal Bank. ‘What happened was, frankly, the Dodd-Frank regulations drove a lot of extra regulation. And our capital was essentially trapped,’ explained Bill Cobb, H&R Block’s president and CEO. Now, that freed up capital will be returned to stockholders through the buyback authorization that runs through June 2019. H&R Block also reported fiscal 2016 first-quarter results that included a 3% increase in the top line, due to higher product revenues. But that was partially offset by the strong dollar. ‘International for us is a relatively small percentage of our revenue, it’s less than 10%, so the currency impact isn’t as strong as it is on a number of other companies, however we have to watch that,’ said Cobb. H&R Block’s international operations are primarily in Canada and Australia.
Stocks in this video: HRB
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