The Struggle Continues for Jackson Hewitt Tax Service Inc. (JTX)
March 12, 2010 9:57 AM
Scott Schneeberger, Bhupender Bohra, and Jim Giannakouros of Oppenheimer gave a dreary outlook for Jackson Hewitt Tax Service Inc. (NYSE: JTX). Jackson Hewitt delivered F3Q10 adjusted EPS of $0.46 (-38% y/y), which was down compared to their estimate of $0.43 and consensus of $0.48. Reported EPS was -$9.75 due primarily to a goodwill impairment write-down of franchise and company-owned operations. JTX has struggled for three primary reasons:
- its lack of RAL product in 50% of its locations
- continued tough labor market conditions
- industry competitiveness
Though results could have been worse given circumstances, JTX's franchisees' determination kept it vertical, albeit against the ropes. These analysts anticipate continued franchisee aggressiveness through 4/15/10, though the "second" tax season is typically not its forte.
Jackson Hewitt shares are up 2.65% today to $2.32. Despite trading well off their 52 week high of $7.58, it has rebounded a bit since hitting $2.01 just a month ago.
