Fact based stock research
Rent-A-Center (NasdaqGS:RCII)

US76009N1000

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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Rent-A-Center stock research in summary

rentacenter.com

ANALYSIS: With an Obermatt Combined Rank of 55 (better than 55% compared with investment alternatives), Rent-A-Center (Electronics Retail, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Rent-A-Center are a good value (attractively priced) with a consolidated Value Rank of 93 (better than 93% of alternatives) but show below-average growth (Growth Rank of 43), and are riskily financed (Safety Rank of 39), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 55, is a buy recommendation based on Rent-A-Center's financial characteristics. As the company Rent-A-Center's key financial metrics exhibit good value (Obermatt Value Rank of 93) but low growth (Obermatt Growth Rank of 43) and risky financing practices (Obermatt Safety Rank of 39), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 93% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	93
Growth Rank	43
Safety Rank	39
Combined Rank	55

Country	USA
Industry	Electronics Retail
Index	Dividends USA, NASDAQ
Size class	X-Large

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Rent-A-Center

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	80	93	94	93
GROWTH
GROWTH	85	69	63	43
SAFETY
SAFETY	3	39	39	39
SENTIMENT
SENTIMENT	n/a	73	63	^new
360° VIEW
360° VIEW	n/a	93	57	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Rent-A-Center is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	80	93	94	93
GROWTH
GROWTH	85	69	63	43
SAFETY
SAFETY	3	39	39	39
COMBINED
COMBINED	55	55	55	55

Last update of combined financial performance: 6-Oct-2022. Stock analysis on combined financial performance: The higher the rank of Rent-A-Center the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 93 (better than 93% compared with alternatives) for 2022, Rent-A-Center shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Rent-A-Center. Price-to-Sales (P/S) is 61, which means that the stock price compared with what market professionals expect for future sales is lower than for 61% of comparable companies, indicating a good value concerning Rent-A-Center's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 90% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 100 (dividends are expected to be higher than 100% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 56% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Rent-A-Center to 44. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 93, is a buy recommendation based on Rent-A-Center's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	78	50	56	61
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	66	87	86	90
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	30	55	47	44
DIVIDEND YIELD
DIVIDEND YIELD	87	97	98	100
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	80	93	94	93

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Rent-A-Center; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 43 (better than 43% compared with alternatives), Rent-A-Center shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Rent-A-Center. Sales Growth has a rank of 70 which means that currently, professionals expect the company to grow more than 70% of its competitors. Both Profit Growth, with a rank of 59, and Stock Returns, with a rank of 51, are also above average. But Capital Growth only has a rank of 9, which means that, currently, professionals expect the company to grow its invested capital less than 91% of its competitors. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 43, is a hold recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	78	85	48	70
PROFIT GROWTH
PROFIT GROWTH	6	55	56	59
CAPITAL GROWTH
CAPITAL GROWTH	n/a	46	27	9
STOCK RETURNS
STOCK RETURNS	80	41	91	51
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	85	69	63	43

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Rent-A-Center.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 39 (better than 39% compared with alternatives), the company Rent-A-Center has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Rent-A-Center is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Rent-A-Center. Liquidity is at 40, meaning that the company generates less profit to service its debt than 60% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 26, meaning the company has an above-average debt-to-equity ratio. It has more debt than 74% of its competitors. Finally, Refinancing is at a rank of 10 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 90% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 39 (worse than 61% compared with alternatives), Rent-A-Center has a financing structure that is riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Rent-A-Center because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	11	64	21	26
REFINANCING
REFINANCING	15	10	10	10
LIQUIDITY
LIQUIDITY	46	80	27	40
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	3	39	39	39

Last update of Safety Rank: 6-Oct-2022. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Rent-A-Center and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	100	78	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	30	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	85	61	^new
MARKET PULSE
MARKET PULSE	n/a	18	31	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	73	63	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Rent-A-Center.
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