Three Companies to Consider Before April 15: Intuit, Inc. (INTU), H&R Block, Inc. (HRB), Blucora Inc (BCOR)

Intuit is the most expensive stock but it has the most diverse stream of revenue. For example, for the six months ended Jan. 31, the company recorded $1.6 billion in revenue comprised of financial management solutions ($388 million or 24% of revenue), employee management solutions ($279 million or 17.3%), payment solutions ($231 million or 14.3%), consumer tax ($252 million or 15.6%), financial services ($186 million or 11.5%), accounting professionals ($155 million or 9.6%) and other ($124 million or 7.7%). Unfortunately, the consumer tax business experienced a decline in sales of 25% from the same period last year.

H&R Block reached revenue of $196.3 million from its tax services for the six months ended October 31, 2012. This is an increase of about 1.5% compared to the same period last year. A small increase, but nevertheless an increase.

Conclusion

While all three companies offer exposure to the growing field of electronic tax filing, Intuit, H&R Block, and Blucora have different approaches to providing tax services. Intuit provides mostly an installation-based tax software that is also a relatively small part of Intuit’s business portfolio. The company offers a number of other services that compete directly with larger companies, especially in financial services and business management software. While this is good for diversification, it could mean that the company has to compete with larger and better companies. Also, the sharp decline in tax software sales indicates that taxes are not the strongest area for Intuit.

H&R Block and Blucora offer on-line and installable tax software. However, H&R Block also offers in-person tax services, which also provides the opportunity to sell additional products. Also, H&R Block’s focus on and experience in tax services make it the best bet to gain exposure to the electronic tax preparation service industry. However, its stock has risen by 57% in the past year.

To conclude, there is no clear winner of the three companies discussed above. Investors considering to profit from the growing e-filing software industry before the current tax season is over may want to allocate funds across these three companies in order to reduce individual company risk.

The article Three Companies to Consider Before April 15 originally appeared on Fool.com and is written by Delian Naydenov.

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