Reviewing H&R Block (NYSE:HRB) & Emerald (NYSE:EEX)

H&R Block (NYSE:HRB) and Emerald (NYSE:EEX) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, institutional ownership, risk and analyst recommendations.

Valuation & Earnings

This table compares H&R Block and Emerald”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
H&R Block	$3.61 billion	2.08	$595.32 million	$4.08	13.75
Emerald	$413.10 million	2.55	$2.20 million	$0.03	176.67

H&R Block has higher revenue and earnings than Emerald. H&R Block is trading at a lower price-to-earnings ratio than Emerald, indicating that it is currently the more affordable of the two stocks.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
H&R Block	15.20%	-179.57%	20.56%
Emerald	1.57%	1.75%	0.63%

Analyst Ratings

This is a summary of current ratings and target prices for H&R Block and Emerald, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
H&R Block	1	1	1	0	2.00
Emerald	0	0	2	0	3.00

H&R Block presently has a consensus price target of $62.00, indicating a potential upside of 10.56%. Emerald has a consensus price target of $7.90, indicating a potential upside of 49.06%. Given Emerald’s stronger consensus rating and higher probable upside, analysts plainly believe Emerald is more favorable than H&R Block.

Institutional & Insider Ownership

90.1% of H&R Block shares are held by institutional investors. Comparatively, 14.9% of Emerald shares are held by institutional investors. 1.3% of H&R Block shares are held by company insiders. Comparatively, 4.0% of Emerald shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

H&R Block has a beta of 0.24, meaning that its share price is 76% less volatile than the S&P 500. Comparatively, Emerald has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500.

Dividends

H&R Block pays an annual dividend of $1.50 per share and has a dividend yield of 2.7%. Emerald pays an annual dividend of $0.06 per share and has a dividend yield of 1.1%. H&R Block pays out 36.8% of its earnings in the form of a dividend. Emerald pays out 200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. H&R Block has increased its dividend for 9 consecutive years. H&R Block is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

H&R Block beats Emerald on 9 of the 17 factors compared between the two stocks.

About H&R Block

H&R Block, Inc. engages in the provision of tax return preparation solutions, financial products and small business solutions. The company was founded by Henry W. Bloch and Richard A. Bloch on January 25, 1955, and is headquartered in Kansas City, MO.

About Emerald

Emerald Holding, Inc. operates business-to-business (B2B) trade shows in the United States. The company provides B2B trade show franchises; and B2B print publications and digital media products, which provide industry specific business news and information across various sectors. It also offers B2B e-commerce and digital merchandising solutions to manufacturers and retailers through Elastic Suite and Bulletin platforms. The company serves retail, design, technology, equipment, and safety and security. Emerald Holding, Inc. was incorporated in 2013 and is headquartered in New York, New York.