RCII
Rent-A-Center Inc
Consumer
01/30/2017
Presented
| Date | 01/25/2017 |
| Price | $8.33 |
| Market Cap | $0.45B |
| Ent Value | $1.27B |
| P/E Ratio | N/A |
| Book Value | $9.52 |
| Div Yield | 0.04% |
| Shares O/S | 53.45M |
| Ave Daily Vol | 1,409,019 |
| Short Int | N/A |
Current
| Price | $29.88 |
| Market Cap | $1.63B |
| Rent-A-Center, Inc. engages in leasing household durable goods to customers on a rent-to-own basis. It provides the customers the ownership of products, such as consumer electronics, appliances, computers, furniture and accessories, under rental purchase agreements with no long-term obligation. Its stores generally offer durable products such as major consumer electronics, appliances, computers, and furniture and accessories under flexible rental purchase agreements that typically allow the customer to obtain ownership of the merchandise at the conclusion of an agreed-upon rental period. The company operates its business through the following segments: Core U.S., Acceptance Now, Mexico and Franchising. The Core U.S. segment consists of company-owned rent-to-own stores in the United States, Canada and Puerto Rico that lease household durable goods to customers on a rent-to-own basis. The Acceptance Now segment offers the rent-to-own transaction to consumers who do not qualify for financing from the traditional retailer through kiosks located within such retailer's locations. The Mexico segment consists of its company-owned rent-to-own stores in Mexico that lease household durable goods to customers on a rent-to-own basis. The Franchising segment use Rent-A-Center's, ColorTyme's or RimTyme's trade names, service marks, trademarks and logos, and operate under distinctive operating procedures and standards. Rent-A-Center was founded by Mark E. Speese on September 16, 1986 and is headquartered in Plano, TX. |
Publicly traded companies mentioned herein: Rent-A-Center Inc (RCII)
Highlights
The presenter is short shares of Rent-A-Center (RCII), stating the core business model of the company remains structurally challenged. He sees continued declines in the stores and Mexican businesses, and also expects the kiosk business, which had been cannibalizing some of the stores business, to start declining. Since RCII is a highly levered company with declining EBITDA and significant lease obligations, the presenter believes earnings are set to turn negative over the course of 2017. Despite RCII shares having already undergone significant declines, the presenter sees further downside, and is currently targeting $3 per share with the possibility of further downside to come.
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