RENT-A-CENTER INC (RCII) Fundamental Analysis & Valuation

NASDAQ:RCII • US76009N1000

Current stock price

26.78 USD
-0.03 (-0.11%)
At close:
26.09 USD
-0.69 (-2.58%)
After Hours:

This RCII fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. RCII Profitability Analysis

1.1 Basic Checks

  • In the past year RCII was profitable.
  • RCII had a positive operating cash flow in the past year.
RCII Yearly Net Income VS EBIT VS OCF VS FCFRCII Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 0 100M -100M 200M 300M 400M

1.2 Ratios

  • RCII's Return On Assets of 0.71% is on the low side compared to the rest of the industry. RCII is outperformed by 72.64% of its industry peers.
  • Looking at the Return On Equity, with a value of 3.56%, RCII is doing worse than 63.21% of the companies in the same industry.
  • With a Return On Invested Capital value of 12.42%, RCII perfoms like the industry average, outperforming 59.43% of the companies in the same industry.
  • Measured over the past 3 years, the Average Return On Invested Capital for RCII is significantly above the industry average of 13.35%.
  • The last Return On Invested Capital (12.42%) for RCII is well below the 3 year average (30.27%), which needs to be investigated, but indicates that RCII had better years and this may not be a problem.
Industry RankSector Rank
ROA 0.71%
ROE 3.56%
ROIC 12.42%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)30.27%
ROIC(5y)N/A
RCII Yearly ROA, ROE, ROICRCII Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 0 20 -20

1.3 Margins

  • RCII's Profit Margin of 0.44% is on the low side compared to the rest of the industry. RCII is outperformed by 75.47% of its industry peers.
  • In the last couple of years the Profit Margin of RCII has grown nicely.
  • RCII has a Operating Margin (6.93%) which is in line with its industry peers.
  • In the last couple of years the Operating Margin of RCII has grown nicely.
  • The Gross Margin of RCII (48.63%) is better than 79.25% of its industry peers.
  • RCII's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 6.93%
PM (TTM) 0.44%
GM 48.63%
OM growth 3Y31.31%
OM growth 5Y28%
PM growth 3Y109.65%
PM growth 5YN/A
GM growth 3Y-8.4%
GM growth 5Y-5.67%
RCII Yearly Profit, Operating, Gross MarginsRCII Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 0 20 40 60

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ROAROEROICOperating and Profit MarginShow most profitable peers

5

2. RCII Health Analysis

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so RCII is creating value.
  • RCII has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
RCII Yearly Shares OutstandingRCII Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 20M 40M 60M
RCII Yearly Total Debt VS Total AssetsRCII Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 500M 1B 1.5B 2B 2.5B

2.2 Solvency

  • RCII has an Altman-Z score of 3.21. This indicates that RCII is financially healthy and has little risk of bankruptcy at the moment.
  • RCII has a better Altman-Z score (3.21) than 66.04% of its industry peers.
  • The Debt to FCF ratio of RCII is 3.32, which is a good value as it means it would take RCII, 3.32 years of fcf income to pay off all of its debts.
  • Looking at the Debt to FCF ratio, with a value of 3.32, RCII is in the better half of the industry, outperforming 76.42% of the companies in the same industry.
  • RCII has a Debt/Equity ratio of 2.50. This is a high value indicating a heavy dependency on external financing.
  • RCII has a worse Debt to Equity ratio (2.50) than 73.58% of its industry peers.
Industry RankSector Rank
Debt/Equity 2.5
Debt/FCF 3.32
Altman-Z 3.21
ROIC/WACC1.25
WACC9.91%
RCII Yearly LT Debt VS Equity VS FCFRCII Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 500M 1B 1.5B

2.3 Liquidity

  • A Current Ratio of 1.88 indicates that RCII should not have too much problems paying its short term obligations.
  • RCII has a better Current ratio (1.88) than 80.19% of its industry peers.
  • RCII has a Quick Ratio of 1.88. This is a bad value and indicates that RCII is not financially healthy enough and could expect problems in meeting its short term obligations.
  • RCII has a Quick ratio (0.46) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.88
Quick Ratio 0.46
RCII Yearly Current Assets VS Current LiabilitesRCII Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 500M 1B 1.5B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

3

3. RCII Growth Analysis

3.1 Past

  • The earnings per share for RCII have decreased strongly by -28.91% in the last year.
  • The Earnings Per Share has been growing by 48.44% on average over the past years. This is a very strong growth
  • RCII shows a small growth in Revenue. In the last year, the Revenue has grown by 7.21%.
  • The Revenue has been growing by 9.11% on average over the past years. This is quite good.
EPS 1Y (TTM)-28.91%
EPS 3Y75.31%
EPS 5Y48.44%
EPS Q2Q%-38.16%
Revenue 1Y (TTM)7.21%
Revenue growth 3Y19.88%
Revenue growth 5Y9.11%
Sales Q2Q%-13.32%

3.2 Future

  • Based on estimates for the next years, RCII will show a decrease in Earnings Per Share. The EPS will decrease by -4.38% on average per year.
  • The Revenue is expected to decrease by -1.10% on average over the next years.
EPS Next Y-34.02%
EPS Next 2Y-20.68%
EPS Next 3Y-9.64%
EPS Next 5Y-4.38%
Revenue Next Year-7.76%
Revenue Next 2Y-6.15%
Revenue Next 3Y-2.54%
Revenue Next 5Y-1.1%

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 decreasing.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
RCII Yearly Revenue VS EstimatesRCII Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1B 2B 3B 4B
RCII Yearly EPS VS EstimatesRCII Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0 2 4 6

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6

4. RCII Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 6.85, the valuation of RCII can be described as very cheap.
  • Based on the Price/Earnings ratio, RCII is valued a bit cheaper than the industry average as 79.25% of the companies are valued more expensively.
  • RCII is valuated cheaply when we compare the Price/Earnings ratio to 26.78, which is the current average of the S&P500 Index.
  • A Price/Forward Earnings ratio of 7.67 indicates a rather cheap valuation of RCII.
  • RCII's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. RCII is cheaper than 72.64% of the companies in the same industry.
  • RCII is valuated cheaply when we compare the Price/Forward Earnings ratio to 23.54, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 6.85
Fwd PE 7.67
RCII Price Earnings VS Forward Price EarningsRCII Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RCII is on the same level as its industry peers.
  • Based on the Price/Free Cash Flow ratio, RCII is valued cheaper than 99.06% of the companies in the same industry.
Industry RankSector Rank
P/FCF 3.62
EV/EBITDA 5.9
RCII Per share dataRCII EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 20 40 60

4.3 Compensation for Growth

  • RCII's earnings are expected to decrease with -9.64% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.14
EPS Next 2Y-20.68%
EPS Next 3Y-9.64%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

5

5. RCII Dividend Analysis

5.1 Amount

  • RCII has a Yearly Dividend Yield of 5.51%, which is a nice return.
  • Compared to an average industry Dividend Yield of 3.06, RCII pays a better dividend. On top of this RCII pays more dividend than 96.23% of the companies listed in the same industry.
  • RCII's Dividend Yield is rather good when compared to the S&P500 average which is at 1.83.
Industry RankSector Rank
Dividend Yield 5.51%

5.2 History

  • RCII has paid a dividend for at least 10 years, which is a reliable track record.
  • The dividend of RCII decreased recently.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
RCII Yearly Dividends per shareRCII Yearly Dividends per shareYearly Dividends per share 2016 2017 2019 2020 2021 2022 0.5 1

5.3 Sustainability

  • 403.30% of the earnings are spent on dividend by RCII. This is not a sustainable payout ratio.
DP403.3%
EPS Next 2Y-20.68%
EPS Next 3Y-9.64%
RCII Yearly Income VS Free CF VS DividendRCII Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 0 100M -100M 200M 300M
RCII Dividend Payout.RCII Dividend Payout, showing the Payout Ratio.RCII Dividend Payout.PayoutRetained Earnings

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RCII Fundamentals: All Metrics, Ratios and Statistics

RENT-A-CENTER INC

NASDAQ:RCII (2/24/2023, 8:00:01 PM)

After market: 26.09 -0.69 (-2.58%)

26.78

-0.03 (-0.11%)

Chartmill FA Rating
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)02-23
Earnings (Next)05-02
Inst Owners80.68%
Inst Owner Change2.72%
Ins Owners6.65%
Ins Owner Change0%
Market Cap1.49B
Revenue(TTM)4.43B
Net Income(TTM)19.52M
Analysts80
Price Target35.13 (31.18%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 5.51%
Yearly Dividend1.24
Dividend Growth(5Y)N/A
DP403.3%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.62%
Min EPS beat(2)3.55%
Max EPS beat(2)13.69%
EPS beat(4)3
Avg EPS beat(4)-3.57%
Min EPS beat(4)-34.34%
Max EPS beat(4)13.69%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-0.68%
Max Revenue beat(2)-0.44%
Revenue beat(4)1
Avg Revenue beat(4)-0.81%
Min Revenue beat(4)-4.3%
Max Revenue beat(4)2.18%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-3.13%
PT rev (3m)-0.88%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.32%
EPS NY rev (1m)0%
EPS NY rev (3m)-4.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.88%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.75%
Valuation
Industry RankSector Rank
PE 6.85
Fwd PE 7.67
P/S 0.34
P/FCF 3.62
P/OCF 3.12
P/B 2.72
P/tB N/A
EV/EBITDA 5.9
EPS(TTM)3.91
EY14.6%
EPS(NY)3.49
Fwd EY13.04%
FCF(TTM)7.4
FCFY27.65%
OCF(TTM)8.59
OCFY32.07%
SpS79.51
BVpS9.85
TBVpS-2.07
PEG (NY)N/A
PEG (5Y)0.14
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 0.71%
ROE 3.56%
ROCE N/A
ROIC 12.42%
ROICexc 13.54%
ROICexgc 21.27%
OM 6.93%
PM (TTM) 0.44%
GM 48.63%
FCFM N/A
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)30.27%
ROIC(5y)N/A
ROICexc(3y)25.34%
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y28.81%
ROICexgc growth 5Y29.73%
ROICexc growth 3Y15.41%
ROICexc growth 5Y21.16%
OM growth 3Y31.31%
OM growth 5Y28%
PM growth 3Y109.65%
PM growth 5YN/A
GM growth 3Y-8.4%
GM growth 5Y-5.67%
F-Score5
Asset Turnover1.6
Health
Industry RankSector Rank
Debt/Equity 2.5
Debt/FCF 3.32
Debt/EBITDA 3
Cap/Depr 44%
Cap/Sales N/A
Interest Coverage N/A
Cash Conversion N/A
Profit Quality 2111.29%
Current Ratio 1.88
Quick Ratio 0.46
Altman-Z 3.21
F-Score5
WACC9.91%
ROIC/WACC1.25
Cap/Depr(3y)44.07%
Cap/Depr(5y)51.22%
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)151.15%
Profit Quality(5y)694.43%
High Growth Momentum
Growth
EPS 1Y (TTM)-28.91%
EPS 3Y75.31%
EPS 5Y48.44%
EPS Q2Q%-38.16%
EPS Next Y-34.02%
EPS Next 2Y-20.68%
EPS Next 3Y-9.64%
EPS Next 5Y-4.38%
Revenue 1Y (TTM)7.21%
Revenue growth 3Y19.88%
Revenue growth 5Y9.11%
Sales Q2Q%-13.32%
Revenue Next Year-7.76%
Revenue Next 2Y-6.15%
Revenue Next 3Y-2.54%
Revenue Next 5Y-1.1%
EBIT growth 1Y-28.39%
EBIT growth 3Y57.42%
EBIT growth 5Y39.67%
EBIT Next Year-27.85%
EBIT Next 3Y-6.53%
EBIT Next 5Y-3.7%
FCF growth 1Y63.75%
FCF growth 3Y18.25%
FCF growth 5Y2.4%
OCF growth 1Y68.67%
OCF growth 3Y19.92%
OCF growth 5Y2.07%

RENT-A-CENTER INC / RCII Fundamental Analysis FAQ

What is the fundamental rating for RCII stock?

ChartMill assigns a fundamental rating of 4 / 10 to RCII.


What is the valuation status of RENT-A-CENTER INC (RCII) stock?

ChartMill assigns a valuation rating of 7 / 10 to RENT-A-CENTER INC (RCII). This can be considered as Undervalued.


What is the profitability of RCII stock?

RENT-A-CENTER INC (RCII) has a profitability rating of 1 / 10.


Can you provide the expected EPS growth for RCII stock?

The Earnings per Share (EPS) of RENT-A-CENTER INC (RCII) is expected to decline by -34.02% in the next year.


Is the dividend of RENT-A-CENTER INC sustainable?

The dividend rating of RENT-A-CENTER INC (RCII) is 6 / 10 and the dividend payout ratio is 403.3%.