HRB

kiev · May 29, 2015

Why did HRB go up from 18$ to 23$ without retreat in jan/2013?

I googled and only found a news about 1040E, http://newsroom.hrblock.com/hr-block-takes-easy-and-adds-free-to-1040ez/, is this the reason?

xandman · May 29, 2015

Negative. The market for 1040EZ filers is irrelevant.

Additionally, HRB block has been providing free 1040EZ filings to the US military for years. It's a calculated move.

kiev · May 31, 2015

xandman said:
Negative. The market for 1040EZ filers is irrelevant.

Additionally, HRB block has been providing free 1040EZ filings to the US military for years. It's a calculated move.

So HRB rose without any reasons?

Tavurth · May 31, 2015

HRB was marked up after a period of accumulation. In April 2012 there was a No. 2+ spring, highlighting a lack of urgent sellers. Price was then free to break out of its range, with negligible supply friction. Coerced demand in the form of trapped short sellers, plus break out or bandwagon traders likely helped to fuel further advance.

xandman · May 31, 2015

kiev said:
So HRB rose without any reasons?

Tavurth has a better answer than I can provide which is zip, nada. But it's better than free 1040EZs. I was actually rolling on the floor, but for private reasons.

kiev · Jun 1, 2015

Tavurth said:
HRB was marked up after a period of accumulation. In April 2012 there was a No. 2+ spring, highlighting a lack of urgent sellers. Price was then free to break out of its range, with negligible supply friction. Coerced demand in the form of trapped short sellers, plus break out or bandwagon traders likely helped to fuel further advance.

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Thanks for your reply. But I can't accept you only explain it with technical issue. Still feel it was wired.

newwurldmn · Jun 1, 2015

A few reasons that I can discern:

1. SPX rallied 5% during the same time.
2. IRS lost a court ruling to regulate tax perparers (which would have prevented most of the part time preparers at HRB from being able to prepare returns).
3. Expectations that HRB would benefit from the 2012 fiscal cliff discussions which created complications for individuals who did their own tax preparations.

INTU also rallied, albeit a lot less (but they probably have a lot less sensitivity to the court ruling).

kiev · Jun 4, 2015

newwurldmn said:
A few reasons that I can discern:

1. SPX rallied 5% during the same time.
2. IRS lost a court ruling to regulate tax perparers (which would have prevented most of the part time preparers at HRB from being able to prepare returns).
3. Expectations that HRB would benefit from the 2012 fiscal cliff discussions which created complications for individuals who did their own tax preparations.

INTU also rallied, albeit a lot less (but they probably have a lot less sensitivity to the court ruling).

Thanks for your information, and I think Item 2 is the key point. The news came out in the 2nd day of this wave. Intu has a similar chart style as hrb, but Intu is engaged in finance not tax, so it was affected less than hrb. As to Item 1, spx rallied less than 5 percent, hrb should rise 6 percent(it's beta is 1.2) not 27 percent.

By the way, how could you find this news ?