Rent-A-Center (RCII) closed at $19.68 in the latest trading session, marking a -1.06% move from the prior day. This change was narrower than the S&P 500's daily loss of 1.9%. Meanwhile, the Dow lost 1.77%, and the Nasdaq, a tech-heavy index, lost 2.5%.
Coming into today, shares of the company that leases furniture and appliances with an option to buy had gained 10.38% in the past month. In that same time, the Consumer Discretionary sector lost 0.45%, while the S&P 500 gained 3.04%.
Investors will be hoping for strength from RCII as it approaches its next earnings release. On that day, RCII is projected to report earnings of $0.29 per share, which would represent year-over-year growth of 462.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $680.04 million, down 2.58% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.88 per share and revenue of $2.61 billion. These totals would mark changes of +77.36% and -1.95%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for RCII. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 6.39% higher. RCII is currently sporting a Zacks Rank of #1 (Strong Buy).
Digging into valuation, RCII currently has a Forward P/E ratio of 10.57. For comparison, its industry has an average Forward P/E of 13.16, which means RCII is trading at a discount to the group.
The Consumer Services - Miscellaneous industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 105, which puts it in the top 42% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow RCII in the coming trading sessions, be sure to utilize Zacks.com.
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