Jackson Hewitt (NYSE:JTX) slashed its fiscal second-quarter loss by more than Wall Street had been hoping for and expanded its popular refund anticipation loan program, sparking an 13% leap in the No. 2 U.S. tax preparer’s stock Friday morning.
Parsippany, N.J.-based Jackson Hewitt said it lost $19.4 million, or 67 cents a share, compared with a loss of $19.5 million, or 68 cents a share, a year earlier.
Excluding one-time items, it lost 66 cents a share, easily beating the Street’s view of a loss of 74 cents.
Revenue declined by 14% to $3.5 million.
Jackson Hewitt typically generates a net loss during the first and second quarters as it relies on the months leading up to the tax season for the vast majority of its profits.
“Our preparations for the 2011 tax season are in high gear," CEO Harry Buckley said in a statement.
In particular, Jackson Hewitt said it has expanded its refund anticipation loan (RAL) product coverage to about 80% of anticipated volume and is working with Wal-Mart (NYSE:WMT) to drive more clients to its kiosks.
“We have achieved this level of national coverage by allocating offices based on volume, while ensuring that every franchisee will have coverage under our RAL program,” Buckley said.
The comments come a day after bigger rival H&R Block (NYSE:HRB) saw its stock soar 34% after revealing it has secured full assisted-refund coverage for the upcoming tax season.
Jackson Hewitt holders cheered the results and RAL expansion, bidding the company’s stock up 13.6% to $1.25 in Friday’s premarkets. The stock has suffered deep losses this year, tumbling 75% as of Thursday’s close.