Rent-A-Center Inc. (RCII) Downgraded to Strong Sell at Zacks Investment Research
Rent-A-Center Inc. (NASDAQ:RCII) was downgraded by Zacks Investment Research from a “hold” rating to a “strong sell” rating in a report released on Thursday.
According to Zacks, “Rent-A-Center disappointed investors with its bleak preliminary guidance for third-quarter 2016. The company now expects Core U.S. same store sales to be down nearly 12% in the quarter while Acceptance Now same store sales is estimated to be flat. Core U.S. gross profit is likely to be flat year over year. The company anticipates earnings per share both on the GAAP and non-GAAP basis to be in the range of $0.05 to $0.15 per share. The technical snags and outages after the execution of new point-of-sale system negatively impacted Core sales and compelled management to hold a conservative view. Moreover, Rent-A-Center has been disappointing investors with its top-line performance for the past four consecutive quarters. Accelerated point of sale system rollout, persistent sluggishness across the computers and tablets categories, headwinds across the oil-impacted markets and continued smartphones recast impacted the results.”
Separately, Jefferies Group assumed coverage on Rent-A-Center in a research report on Thursday. They set a “hold” rating for the company. One analyst has rated the stock with a sell rating, two have assigned a hold rating, three have issued a buy rating and one has issued a strong buy rating to the company. Rent-A-Center presently has a consensus rating of “Buy” and an average target price of $22.72.
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Shares of Rent-A-Center (NASDAQ:RCII) opened at 9.55 on Thursday. Rent-A-Center has a one year low of $8.00 and a one year high of $26.26. The stock’s market cap is $507.26 million. The company has a 50 day moving average of $12.38 and a 200-day moving average of $13.00.
Rent-A-Center (NASDAQ:RCII) last released its quarterly earnings results on Wednesday, July 27th. The company reported $0.41 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.49 by $0.08. The firm had revenue of $749.60 million for the quarter, compared to analyst estimates of $782.12 million. Rent-A-Center had a positive return on equity of 14.03% and a negative net margin of 27.93%. The company’s quarterly revenue was down 8.1% compared to the same quarter last year. During the same period last year, the firm earned $0.50 EPS. On average, analysts anticipate that Rent-A-Center will post $1.73 earnings per share for the current year.
The company also recently announced a quarterly dividend, which will be paid on Thursday, October 20th. Stockholders of record on Monday, October 3rd will be issued a dividend of $0.08 per share. This represents a $0.32 dividend on an annualized basis and a dividend yield of 3.35%. The ex-dividend date of this dividend is Thursday, September 29th. Rent-A-Center’s payout ratio is currently -1.93%.
In related news, CEO Robert Dale Davis purchased 10,000 shares of Rent-A-Center stock in a transaction that occurred on Monday, August 1st. The shares were purchased at an average cost of $10.87 per share, with a total value of $108,700.00. Following the transaction, the chief executive officer now owns 131,850 shares of the company’s stock, valued at approximately $1,433,209.50. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Insiders own 3.40% of the company’s stock.
Institutional investors have recently added to or reduced their stakes in the company. ClariVest Asset Management LLC bought a new position in Rent-A-Center during the second quarter valued at approximately $105,000. KCG Holdings Inc. bought a new position in Rent-A-Center during the second quarter valued at approximately $125,000. Mason Street Advisors LLC bought a new position in Rent-A-Center during the second quarter valued at approximately $127,000. Mackenzie Financial Corp bought a new position in Rent-A-Center during the second quarter valued at approximately $132,000. Finally, Panagora Asset Management Inc. bought a new position in Rent-A-Center during the second quarter valued at approximately $150,000. 9.58% of the stock is currently owned by hedge funds and other institutional investors.
Rent-A-Center Company Profile
Rent-A-Center, Inc is a rent-to-own operator in North America. The Company provides an opportunity to obtain ownership of products, such as consumer electronics, appliances, computers (including tablets), smartphones and furniture (including accessories), under rental purchase agreements. The Company operates in four segments: Core U.S., Acceptance Now, Mexico and Franchising.
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