Why JTH Holding (TAX) Stock Is Higher Today

NEW YORK (TheStreet) -- Shares of JTH Holding (TAX) are up 7.08% to $30.09 after the parent company of Liberty Tax Service reported fiscal fourth quarter net income per share of Class A and Class B common stock of $2.18 per share, compared to $2.01 in the previous year.

Total revenue for the three months ended April 30 was $103.5 million versus $93.4 million in the period a year ago.

Analysts surveyed by Thompson Reuters had expected JTH to report earnings of $2.20 per share and revenue of $101.35 million for the quarter.

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TheStreet Ratings team rates JTH HOLDING INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate JTH HOLDING INC (TAX) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, good cash flow from operations, compelling growth in net income and solid stock price performance. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • TAX's revenue growth has slightly outpaced the industry average of 1.5%. Since the same quarter one year prior, revenues slightly increased by 9.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Diversified Consumer Services industry and the overall market, JTH HOLDING INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Diversified Consumer Services industry average. The net income increased by 142.4% when compared to the same quarter one year prior, rising from $1.67 million to $4.06 million.
  • Net operating cash flow has slightly increased to -$22.97 million or 4.98% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -18.09%.
  • Powered by its strong earnings growth of 133.33% and other important driving factors, this stock has surged by 71.80% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • You can view the full analysis from the report here: TAX Ratings Report
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