AARON'S CO INC/THE (AAN) Stock Fundamental Analysis
NYSE:AAN - New York Stock Exchange, Inc. - US00258W1080 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to AAN. AAN was compared to 122 industry peers in the Specialty Retail industry. Both the profitability and financial health of AAN have multiple concerns. AAN does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year AAN has reported negative net income.
In the past year AAN had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: AAN reported negative net income in multiple years.
AAN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of -2.40%, AAN is in line with its industry, outperforming 41.80% of the companies in the same industry.
Looking at the Return On Equity, with a value of -6.47%, AAN is in line with its industry, outperforming 49.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.4% | ||
| ROE | -6.47% | ||
| ROIC | N/A |
ROA(3y)2.5%
ROA(5y)-2.14%
ROE(3y)4.98%
ROE(5y)-3.82%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
In the last couple of years the Profit Margin of AAN has declined.
AAN's Operating Margin has declined in the last couple of years.
The Gross Margin of AAN (52.53%) is better than 80.33% of its industry peers.
AAN's Gross Margin has declined in the last couple of years.
AAN does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 52.53% |
OM growth 3Y-44.69%
OM growth 5Y-28.43%
PM growth 3YN/A
PM growth 5Y-45.82%
GM growth 3Y-5.74%
GM growth 5Y-2.88%
2. Health
2.1 Basic Checks
AAN does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for AAN has been reduced compared to 1 year ago.
AAN has less shares outstanding than it did 5 years ago.
AAN has a better debt/assets ratio than last year.
2.2 Solvency
AAN has an Altman-Z score of 0.96. This is a bad value and indicates that AAN is not financially healthy and even has some risk of bankruptcy.
AAN's Altman-Z score of 0.96 is on the low side compared to the rest of the industry. AAN is outperformed by 77.87% of its industry peers.
A Debt/Equity ratio of 0.31 indicates that AAN is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.31, AAN is in line with its industry, outperforming 53.28% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.31 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.96 |
ROIC/WACCN/A
WACC9.27%
2.3 Liquidity
AAN has a Current Ratio of 0.30. This is a bad value and indicates that AAN is not financially healthy enough and could expect problems in meeting its short term obligations.
AAN has a worse Current ratio (0.30) than 96.72% of its industry peers.
AAN has a Quick Ratio of 0.30. This is a bad value and indicates that AAN is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.19, AAN is not doing good in the industry: 89.34% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.3 | ||
| Quick Ratio | 0.19 |
3. Growth
3.1 Past
AAN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -132.41%.
The earnings per share for AAN have been decreasing by -42.94% on average. This is quite bad
The Revenue has decreased by -8.73% in the past year.
The Revenue has been growing slightly by 3.58% on average over the past years.
EPS 1Y (TTM)-132.41%
EPS 3YN/A
EPS 5Y-42.94%
EPS Q2Q%-117.95%
Revenue 1Y (TTM)-8.73%
Revenue growth 3Y7.24%
Revenue growth 5Y3.58%
Sales Q2Q%-5.14%
3.2 Future
The Earnings Per Share is expected to decrease by -20.60% on average over the next years. This is quite bad
AAN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.34% yearly.
EPS Next Y-102.06%
EPS Next 2Y-14.44%
EPS Next 3Y-13.93%
EPS Next 5Y-20.6%
Revenue Next Year-3.08%
Revenue Next 2Y-0.18%
Revenue Next 3Y0.99%
Revenue Next 5Y1.34%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
AAN reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
AAN is valuated rather expensively with a Price/Forward Earnings ratio of 17.23.
Based on the Price/Forward Earnings ratio, AAN is valued a bit cheaper than the industry average as 63.93% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of AAN to the average of the S&P500 Index (21.29), we can say AAN is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 17.23 |
4.2 Price Multiples
100.00% of the companies in the same industry are more expensive than AAN, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 0.98 |
4.3 Compensation for Growth
A cheap valuation may be justified as AAN's earnings are expected to decrease with -13.93% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-14.44%
EPS Next 3Y-13.93%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.96%, AAN is a good candidate for dividend investing.
AAN's Dividend Yield is rather good when compared to the industry average which is at 5.35. AAN pays more dividend than 94.26% of the companies in the same industry.
AAN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.96% |
5.2 History
AAN has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
The earnings of AAN are negative and hence is the payout ratio. AAN will probably not be able to sustain this dividend level.
DP-36.48%
EPS Next 2Y-14.44%
EPS Next 3Y-13.93%
10.09
+0.1 (+1%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners87.86%
Inst Owner Change-25.35%
Ins Owners3.68%
Ins Owner Change0%
Market Cap318.34M
Analysts51.43
Price Target10.28 (1.88%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.96% |
Yearly Dividend0.49
Dividend Growth(5Y)N/A
DP-36.48%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-185.44%
Min EPS beat(2)-266.32%
Max EPS beat(2)-104.57%
EPS beat(4)0
Avg EPS beat(4)-336.25%
Min EPS beat(4)-887.96%
Max EPS beat(4)-86.14%
EPS beat(8)4
Avg EPS beat(8)-44.8%
EPS beat(12)8
Avg EPS beat(12)-17.65%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-2.69%
Min Revenue beat(2)-3.4%
Max Revenue beat(2)-1.98%
Revenue beat(4)0
Avg Revenue beat(4)-2.9%
Min Revenue beat(4)-3.4%
Max Revenue beat(4)-1.98%
Revenue beat(8)1
Avg Revenue beat(8)-1.86%
Revenue beat(12)3
Avg Revenue beat(12)-0.86%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)-1.75%
EPS NQ rev (1m)-14.72%
EPS NQ rev (3m)-29.58%
EPS NY rev (1m)0%
EPS NY rev (3m)-113.14%
Revenue NQ rev (1m)-0.3%
Revenue NQ rev (3m)-1.31%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.85%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 17.23 | ||
| P/S | 0.15 | ||
| P/FCF | N/A | ||
| P/OCF | 5.39 | ||
| P/B | 0.48 | ||
| P/tB | 0.64 | ||
| EV/EBITDA | 0.98 |
EPS(TTM)-0.47
EYN/A
EPS(NY)0.59
Fwd EY5.8%
FCF(TTM)-1.08
FCFYN/A
OCF(TTM)1.87
OCFY18.57%
SpS65.6
BVpS20.85
TBVpS15.81
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.4% | ||
| ROE | -6.47% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 52.53% | ||
| FCFM | N/A |
ROA(3y)2.5%
ROA(5y)-2.14%
ROE(3y)4.98%
ROE(5y)-3.82%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)9.13%
ROCE(5y)9.77%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y-44.69%
OM growth 5Y-28.43%
PM growth 3YN/A
PM growth 5Y-45.82%
GM growth 3Y-5.74%
GM growth 5Y-2.88%
F-Score4
Asset Turnover1.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.31 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 0.4 | ||
| Cap/Depr | 17.59% | ||
| Cap/Sales | 4.5% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | 11.62% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.3 | ||
| Quick Ratio | 0.19 | ||
| Altman-Z | 0.96 |
F-Score4
WACC9.27%
ROIC/WACCN/A
Cap/Depr(3y)17.01%
Cap/Depr(5y)15.28%
Cap/Sales(3y)4.75%
Cap/Sales(5y)4.53%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-132.41%
EPS 3YN/A
EPS 5Y-42.94%
EPS Q2Q%-117.95%
EPS Next Y-102.06%
EPS Next 2Y-14.44%
EPS Next 3Y-13.93%
EPS Next 5Y-20.6%
Revenue 1Y (TTM)-8.73%
Revenue growth 3Y7.24%
Revenue growth 5Y3.58%
Sales Q2Q%-5.14%
Revenue Next Year-3.08%
Revenue Next 2Y-0.18%
Revenue Next 3Y0.99%
Revenue Next 5Y1.34%
EBIT growth 1Y-143.99%
EBIT growth 3Y-40.69%
EBIT growth 5Y-25.86%
EBIT Next Year380.41%
EBIT Next 3Y83.29%
EBIT Next 5Y47.46%
FCF growth 1Y-220.09%
FCF growth 3Y-33.07%
FCF growth 5Y-6.35%
OCF growth 1Y-55.53%
OCF growth 3Y-20.26%
OCF growth 5Y-0.66%