Aaron’s (AAN) & The Competition Head to Head Survey

Aaron’s (NYSE: AAN) is one of 16 public companies in the “Equipment rental & leasing, not elsewhere classified” industry, but how does it weigh in compared to its competitors? We will compare Aaron’s to similar businesses based on the strength of its risk, dividends, profitability, analyst recommendations, earnings, valuation and institutional ownership.

Valuation and Earnings

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This table compares Aaron’s and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Aaron’s $3.38 billion $292.53 million 18.08
Aaron’s Competitors $1.49 billion $248.19 million -0.46

Aaron’s has higher revenue and earnings than its competitors. Aaron’s is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Aaron’s pays an annual dividend of $0.12 per share and has a dividend yield of 0.3%. Aaron’s pays out 4.7% of its earnings in the form of a dividend. As a group, “Equipment rental & leasing, not elsewhere classified” companies pay a dividend yield of 2.4% and pay out 34.1% of their earnings in the form of a dividend. Aaron’s has increased its dividend for 11 consecutive years.

Profitability

This table compares Aaron’s and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aaron’s 8.65% 11.64% 7.06%
Aaron’s Competitors 4.17% 3.45% -0.56%

Risk and Volatility

Aaron’s has a beta of 0.05, meaning that its stock price is 95% less volatile than the S&P 500. Comparatively, Aaron’s’ competitors have a beta of 1.87, meaning that their average stock price is 87% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Aaron’s and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aaron’s 1 3 7 1 2.67
Aaron’s Competitors 81 396 633 50 2.56

Aaron’s presently has a consensus price target of $46.50, suggesting a potential upside of 0.48%. As a group, “Equipment rental & leasing, not elsewhere classified” companies have a potential upside of 17.99%. Given Aaron’s’ competitors higher possible upside, analysts plainly believe Aaron’s has less favorable growth aspects than its competitors.

Insider & Institutional Ownership

58.4% of shares of all “Equipment rental & leasing, not elsewhere classified” companies are held by institutional investors. 2.3% of Aaron’s shares are held by insiders. Comparatively, 14.2% of shares of all “Equipment rental & leasing, not elsewhere classified” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Aaron’s beats its competitors on 10 of the 15 factors compared.

Aaron’s Company Profile

Aaron's, Inc. operates as an omnichannel provider of lease-purchase solutions. It operates through three segments: Progressive Leasing, Aaron's Business, and DAMI. The company engages in the sale, lease ownership, and specialty retailing of furniture, consumer electronics, home appliances, and accessories. As of February 15, 2018, it operated approximately 1,726 company-operated and franchised stores in 47 states and Canada, as well as its e-commerce platform, Aarons.com. Aaron's, Inc. was founded in 1955 and is headquartered in Atlanta, Georgia.

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