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RCII

Rent-A-CenterNasdaqGS:RCII Stock Report

Market Cap

US$2.9b

7D

-4.5%

1Y

28.0%

Updated

02 Dec, 2021

Data

Company Financials +
RCII fundamental analysis
Snowflake Score
Valuation4/6
Future Growth4/6
Past Performance1/6
Financial Health2/6
Dividends4/6

RCII Stock Overview

Rent-A-Center, Inc., together with its subsidiaries, leases household durable goods to customers on a lease-to-own basis.

Rent-A-Center Competitors

Conn's

NasdaqGS:CONN

US$640.7m

Befesa

XTRA:BFSA

€2.4b

FlexShopper

NasdaqCM:FPAY

US$51.6m

Brand Concepts

NSEI:BCONCEPTS

₹413.3m

Price History & Performance

Summary of all time highs, changes and price drops for Rent-A-Center
Historical stock prices
Current Share PriceUS$44.78
52 Week HighUS$67.76
52 Week LowUS$33.60
Beta1.46
1 Month Change-15.64%
3 Month Change-30.34%
1 Year Change28.02%
3 Year Change208.62%
5 Year Change283.72%
Change since IPO2,820.44%

Recent News & Updates

Oct 18

Rent-A-Center Remains Too Cheap

The company, whilst somewhat cyclical, is benefiting from secular tailwinds. The Acima acquisition is bringing many benefits, like a better decision engine, smoother consumer experience, efficiency gains, growth and synergies. The shares are now below where they were after a very solid Q2.

Aug 30
Is Now The Time To Look At Buying Rent-A-Center, Inc. (NASDAQ:RCII)?

Is Now The Time To Look At Buying Rent-A-Center, Inc. (NASDAQ:RCII)?

Rent-A-Center, Inc. ( NASDAQ:RCII ), might not be a large cap stock, but it led the NASDAQGS gainers with a relatively...

Aug 16
We Think Rent-A-Center (NASDAQ:RCII) Can Stay On Top Of Its Debt

We Think Rent-A-Center (NASDAQ:RCII) Can Stay On Top Of Its Debt

Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of...

Shareholder Returns

RCIIUS Specialty RetailUS Market
7D-4.5%-5.4%-3.5%
1Y28.0%25.8%19.4%

Return vs Industry: RCII exceeded the US Specialty Retail industry which returned 24% over the past year.

Return vs Market: RCII exceeded the US Market which returned 17.8% over the past year.

Price Volatility

Is RCII's price volatile compared to industry and market?
RCII volatility
RCII Average Weekly Movement7.4%
Specialty Retail Industry Average Movement6.8%
Market Average Movement6.1%
10% most volatile stocks in US Market14.9%
10% least volatile stocks in US Market2.4%

Stable Share Price: RCII is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: RCII's weekly volatility (7%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
196014,320Mitch Fadelhttps://www.rentacenter.com

Rent-A-Center, Inc., together with its subsidiaries, leases household durable goods to customers on a lease-to-own basis. The company operates in four segments: Rent-A-Center Business, Preferred Lease, Mexico, and Franchising. It offers furniture and accessories, appliances, consumer electronics, computers, tablets and smartphones, tools, tires, handbags, and other accessories under rental purchase agreements.

Rent-A-Center Fundamentals Summary

How do Rent-A-Center's earnings and revenue compare to its market cap?
RCII fundamental statistics
Market CapUS$2.87b
Earnings (TTM)US$181.43m
Revenue (TTM)US$4.13b

16.3x

P/E Ratio

0.7x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
RCII income statement (TTM)
RevenueUS$4.13b
Cost of RevenueUS$2.03b
Gross ProfitUS$2.09b
ExpensesUS$1.91b
EarningsUS$181.43m

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)2.74
Gross Margin50.72%
Net Profit Margin4.39%
Debt/Equity Ratio150.1%

How did RCII perform over the long term?

See historical performance and comparison

Dividends

2.8%

Current Dividend Yield

38%

Payout Ratio

Valuation

Is Rent-A-Center undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RCII ($44.78) is trading below our estimate of fair value ($162.49)

Significantly Below Fair Value: RCII is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RCII is poor value based on its PE Ratio (16.3x) compared to the US Specialty Retail industry average (9.5x).

PE vs Market: RCII is good value based on its PE Ratio (16.3x) compared to the US market (16.6x).


Price to Earnings Growth Ratio

PEG Ratio: RCII is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: RCII is overvalued based on its PB Ratio (3.5x) compared to the US Specialty Retail industry average (2.9x).


Future Growth

How is Rent-A-Center forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

26.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RCII's forecast earnings growth (26.7% per year) is above the savings rate (2%).

Earnings vs Market: RCII's earnings (26.7% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: RCII's revenue (11.5% per year) is forecast to grow faster than the US market (10.1% per year).

High Growth Revenue: RCII's revenue (11.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if RCII's Return on Equity is forecast to be high in 3 years time


Past Performance

How has Rent-A-Center performed over the past 5 years?

76.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RCII has a large one-off loss of $88.1M impacting its September 30 2021 financial results.

Growing Profit Margin: RCII's current net profit margins (4.4%) are lower than last year (7%).


Past Earnings Growth Analysis

Earnings Trend: RCII has become profitable over the past 5 years, growing earnings by 76.6% per year.

Accelerating Growth: RCII's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RCII had negative earnings growth (-5.7%) over the past year, making it difficult to compare to the Specialty Retail industry average (144.8%).


Return on Equity

High ROE: Whilst RCII's Return on Equity (21.24%) is high, this metric is skewed due to their high level of debt.


Financial Health

How is Rent-A-Center's financial position?


Financial Position Analysis

Short Term Liabilities: RCII's short term assets ($349.4M) do not cover its short term liabilities ($548.7M).

Long Term Liabilities: RCII's short term assets ($349.4M) do not cover its long term liabilities ($1.7B).


Debt to Equity History and Analysis

Debt Level: RCII's net debt to equity ratio (131.5%) is considered high.

Reducing Debt: RCII's debt to equity ratio has increased from 144% to 150.1% over the past 5 years.

Debt Coverage: RCII's debt is well covered by operating cash flow (20.8%).

Interest Coverage: RCII's interest payments on its debt are well covered by EBIT (6.7x coverage).


Balance Sheet


Dividend

What is Rent-A-Center current dividend yield, its reliability and sustainability?

2.77%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RCII's dividend (2.77%) is higher than the bottom 25% of dividend payers in the US market (1.37%).

High Dividend: RCII's dividend (2.77%) is low compared to the top 25% of dividend payers in the US market (3.69%).


Stability and Growth of Payments

Stable Dividend: RCII's dividend payments have been volatile in the past 10 years.

Growing Dividend: RCII's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (38.2%), RCII's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RCII's dividends in 3 years are forecast to be well covered by earnings (16.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.8yrs

Average management tenure


CEO

Mitch Fadel (64 yo)

3.92yrs

Tenure

US$9,217,950

Compensation

Mr. Mitchell E. Fadel, also known as Mitch, has been Chief Executive Officer of Rent-A-Center, Inc since January 2, 2018. Mr. Fadel served as President of U.S. Pawn at EZCORP, Inc. from August 2015 to Dece...


CEO Compensation Analysis

Compensation vs Market: Mitch's total compensation ($USD9.22M) is above average for companies of similar size in the US market ($USD5.28M).

Compensation vs Earnings: Mitch's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: RCII's management team is considered experienced (3.8 years average tenure).


Board Members

Experienced Board: RCII's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: RCII insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 22.1%.


Top Shareholders

Company Information

Rent-A-Center, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Rent-A-Center, Inc.
  • Ticker: RCII
  • Exchange: NasdaqGS
  • Founded: 1960
  • Industry: Computer and Electronics Retail
  • Sector: Retail
  • Market Cap: US$2.869b
  • Shares outstanding: 66.14m
  • Website: https://www.rentacenter.com

Number of Employees


Location

  • Rent-A-Center, Inc.
  • 5501 Headquarters Drive
  • Plano
  • Texas
  • 75024
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/12/02 23:30
End of Day Share Price2021/12/02 00:00
Earnings2021/09/30
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.