Making Money Off Taxes

Now that you have finished filing your tax returns [or at least filed your extensions], you can now concentrate on the companies that make money off taxes. These include the tax preparers and the tax software. The larger of the two tax preparation companies, H&R Block (HRB), is based in in Kansas City, Missouri and has been around since 1946. They also provide investment, mortgage and accounting services. Their P/E is 27 and the PEG is 1.43. They pay a decent yield of 2.2%. 91% of their shares are owned by institutions, the largest of which includes Franklin Resources, which owns 9.25%, and T. Rowe Price which ons about 8% of the shares. They report their earnings on June 6.

Jackson Hewitt Tax Service (JTX) has been appearing in the news quite a bit lately. The Justice Department is accusing some of the company's frnachisees of tax fraud. This is the fourth time in the last year that the government has gone after them. Of course, with all the bad news, the stock took a substantial dive at the end of March. It has a P/E of 17.3 and a PEG of .84, with a yield of 1.7%. 98% of their shares are owned by institutions, including Vanguard, Delaware Management and Wellington.

The other way to play the 'tax industry' is through Intuit (INTU), which markets the extremely popular TurboTax software, along with LaCerte and ProSeries tax programs. They also sell the best selling QuickBooks accounting software. P/E is 28.7 and the PEG is 1.4. 85% of the shares are owned by institutions, of which Barclays and Fidelity have the largest ownership. Lots of last minute filings caused Intuit's server to crash, but the problem didn't affect the stock price, which is up a nickel Wednesday.

Author does not own any of the above.