Why H&R Block, Dycom Industries, and Otonomy Slumped Today
The stock market climbed higher on Wednesday, with all three major benchmarks advancing. The tech-heavy Nasdaq Composite led the way with gains of more than 1%. Investors shrugged off geopolitical concerns, and focused instead on the strength of the domestic economy. The U.S. Commerce Department released data that showed better-than-expected economic growth, with gross domestic product (GDP) increasing at a 3% rate, stronger than previously estimated. In spite of solid gains by the major indexes, company-specific news weighed on certain stocks, and H&R Block, Inc. (NYSE: HRB), Dycom Industries, Inc. (NYSE: DY), and Otonomy, Inc. (NASDAQ: OTIC) were among the worst performers of the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.
Shares of H&R Block fell 8.3% following the release of the company's fiscal first-quarter financial results. The tax preparation giant reported revenue grew to $138 million, an increase of 10% over the prior-year quarter, exceeding analysts' expectations of $129 million. The company's net loss of $0.63 per share was $0.07 worse than year-ago period, and missed expectations of $0.62-per-share loss. The loss was not surprising, as the tax preparation business is highly seasonal. The results were in line with the company's expectations, and Block plans to pay its quarterly dividend of $0.24 on Oct. 2.
Investors were likely expecting better results, given that H&R Block shares had gained 27% year to date prior to the earnings release, and may believe that the stock had gotten ahead of itself.
Source: Fool.com
H&R Block Inc. Stock
With 7 Buy predictions and only 2 Sell predictions the community sentiment for the stock is positive.
However, we have a potential of -10.2% for H&R Block Inc. as the target price of 44 € is below the current price of 49.0 €.
