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Rent-A-Center (RCII) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Rent-A-Center (RCII) closed at $25.90 in the latest trading session, marking a -0.84% move from the prior day. This change lagged the S&P 500's daily gain of 0.03%. Elsewhere, the Dow gained 0.13%, while the tech-heavy Nasdaq lost 0.11%.

Coming into today, shares of the company that leases furniture and appliances with an option to buy had gained 3.82% in the past month. In that same time, the Consumer Discretionary sector gained 5.64%, while the S&P 500 gained 4.17%.

RCII will be looking to display strength as it nears its next earnings release. In that report, analysts expect RCII to post earnings of $0.50 per share. This would mark year-over-year growth of 56.25%. Meanwhile, our latest consensus estimate is calling for revenue of $626.62 million, down 2.84% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.26 per share and revenue of $2.62 billion, which would represent changes of +113.21% and -1.44%, respectively, from the prior year.

Any recent changes to analyst estimates for RCII should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% higher. RCII is holding a Zacks Rank of #1 (Strong Buy) right now.

Investors should also note RCII's current valuation metrics, including its Forward P/E ratio of 11.54. This represents a discount compared to its industry's average Forward P/E of 16.2.

The Consumer Services - Miscellaneous industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 29, which puts it in the top 12% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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Rent-A-Center, Inc. (RCII) : Free Stock Analysis Report
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Zacks Investment Research