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Will Progressive Leasing Shape Aaron's (AAN) Q2 Earnings?
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Aaron's, Inc. (AAN - Free Report) is likely to register an increase in the top line when it reports second-quarter 2020 numbers on Jul 29, before the market opens. The Zacks Consensus Estimate for revenues is pegged at $985.3 million, indicating an improvement of 1.8% from the prior-year reported figure.
However, the company’s bottom line is expected to decline year over year. The Zacks Consensus Estimate for earnings for the quarter under review has decreased by a couple of cents in the past seven days and is currently pegged at 69 cents. The Zacks Consensus Estimate suggests a decline of 25.8% from the year-ago period’s figure of 93 cents.
Notably, this leading omni-channel provider of lease-purchase solutions has a trailing four-quarter earnings surprise of 4.1%, on average. In the last reported quarter, the company delivered an earnings surprise of 13.3%.
Factors to Note
While the impact of coronavirus outbreak is likely to get reflected in Aaron's second-quarter 2020 results, the overall performance of the company may not be so bad. Notably, both Progressive Leasing and Aaron's Business segments have been on a path of recovery thanks to the resumption of economic activities. This is quite evident from the company’s guidance of second-quarter revenues in the range of $975 million to $1 billion and adjusted earnings between 80 cents and 85 cents a share issued last month.
Coming to the segments, with Progressive's retail partners reopening their stores, invoice volumes have been showing signs of improvement from a low point in April 2020. In fact, the company projected flat to low-single digit decline in invoice volumes in the quarter to be reported faring better than analysts’ expectations. Write-offs for the quarter are expected to be in-line to slightly better compared with the year-ago period.
For the Aaron's Business segment, management guided revenues written into the portfolio to be down about 15% year over year primarily due to the coronavirus-related softness in April 2020. Notably, the company informed that as of May 2020 almost all of the showrooms of company-owned stores were operational. Write-offs for the second quarter are anticipated to improve by as much as 100 basis points relative to year-ago levels.
Additionally, the company forecasts a decline of 1.5-2.5% for second-quarter same-store revenues. This suggests an improvement from a decline of 4.6% in same-store revenues reported in first-quarter 2020.
Our proven model does not conclusively predict a beat for Aaron's this earnings season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Aaron's has a Zacks Rank #1 but an Earnings ESP of 0.00%.
Stocks With Favorable Combination
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Best Buy (BBY - Free Report) has an Earnings ESP of +44.52% and a Zacks Rank #2.
Costco (COST - Free Report) has an Earnings ESP of +0.76% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
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Will Progressive Leasing Shape Aaron's (AAN) Q2 Earnings?
Aaron's, Inc. (AAN - Free Report) is likely to register an increase in the top line when it reports second-quarter 2020 numbers on Jul 29, before the market opens. The Zacks Consensus Estimate for revenues is pegged at $985.3 million, indicating an improvement of 1.8% from the prior-year reported figure.
However, the company’s bottom line is expected to decline year over year. The Zacks Consensus Estimate for earnings for the quarter under review has decreased by a couple of cents in the past seven days and is currently pegged at 69 cents. The Zacks Consensus Estimate suggests a decline of 25.8% from the year-ago period’s figure of 93 cents.
Notably, this leading omni-channel provider of lease-purchase solutions has a trailing four-quarter earnings surprise of 4.1%, on average. In the last reported quarter, the company delivered an earnings surprise of 13.3%.
Factors to Note
While the impact of coronavirus outbreak is likely to get reflected in Aaron's second-quarter 2020 results, the overall performance of the company may not be so bad. Notably, both Progressive Leasing and Aaron's Business segments have been on a path of recovery thanks to the resumption of economic activities. This is quite evident from the company’s guidance of second-quarter revenues in the range of $975 million to $1 billion and adjusted earnings between 80 cents and 85 cents a share issued last month.
Coming to the segments, with Progressive's retail partners reopening their stores, invoice volumes have been showing signs of improvement from a low point in April 2020. In fact, the company projected flat to low-single digit decline in invoice volumes in the quarter to be reported faring better than analysts’ expectations. Write-offs for the quarter are expected to be in-line to slightly better compared with the year-ago period.
For the Aaron's Business segment, management guided revenues written into the portfolio to be down about 15% year over year primarily due to the coronavirus-related softness in April 2020. Notably, the company informed that as of May 2020 almost all of the showrooms of company-owned stores were operational. Write-offs for the second quarter are anticipated to improve by as much as 100 basis points relative to year-ago levels.
Additionally, the company forecasts a decline of 1.5-2.5% for second-quarter same-store revenues. This suggests an improvement from a decline of 4.6% in same-store revenues reported in first-quarter 2020.
Aarons, Inc. Price, Consensus and EPS Surprise
Aarons, Inc. price-consensus-eps-surprise-chart | Aarons, Inc. Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict a beat for Aaron's this earnings season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Aaron's has a Zacks Rank #1 but an Earnings ESP of 0.00%.
Stocks With Favorable Combination
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Big Lots (BIG - Free Report) has an Earnings ESP of +11.8% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Best Buy (BBY - Free Report) has an Earnings ESP of +44.52% and a Zacks Rank #2.
Costco (COST - Free Report) has an Earnings ESP of +0.76% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>