Aarons Holdings Profitability Analysis

AAN
 Stock
  

USD 14.71  1.39  10.44%   

For Aarons Holdings profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Aarons Holdings to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Aarons Holdings utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Aarons Holdings's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Aarons Holdings over time as well as its relative position and ranking within its peers. Please continue to Trending Equities.
  
Price to Sales Ratio is expected to rise to 0.45 this year. Return on Sales is expected to rise to 0.09 this year. Aarons Holdings Consolidated Income is quite stable at the moment as compared to the past year. The company's current value of Consolidated Income is estimated at 118.61 Million. Net Income is expected to rise to about 118.6 M this year, although the value of Accumulated Other Comprehensive Income will most likely fall to (797.3 K).

Aarons Holdings Revenues

2.01 Billion

Is Aarons Holdings' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Aarons Holdings. If investors know Aarons will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Aarons Holdings listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
-0.35
Market Capitalization
410 M
Quarterly Revenue Growth YOY
0.31
Return On Assets
0.0799
Return On Equity
0.0782
The market value of Aarons Holdings is measured differently than its book value, which is the value of Aarons that is recorded on the company's balance sheet. Investors also form their own opinion of Aarons Holdings' value that differs from its market value or its book value, called intrinsic value, which is Aarons Holdings' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Aarons Holdings' market value can be influenced by many factors that don't directly affect Aarons Holdings' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Aarons Holdings' value and its price as these two are different measures arrived at by different means. Investors typically determine Aarons Holdings value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Aarons Holdings' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Aarons Holdings Current Ratio vs. EBITDA Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Aarons Holdings's current stock value. Our valuation model uses many indicators to compare Aarons Holdings value to that of its competitors to determine the firm's financial worth.
Aarons Holdings is rated below average in ebitda category among related companies. It is number one stock in current ratio category among related companies . The ratio of EBITDA to Current Ratio for Aarons Holdings is about  226,711,864 . Aarons Holdings Earnings Before Interest Taxes and Depreciation Amortization EBITDA are quite stable at the moment as compared to the past year. The company's current value of Earnings Before Interest Taxes and Depreciation Amortization EBITDA is estimated at 707.79 Million. Comparative valuation analysis is a catch-all model that can be used if you cannot value Aarons Holdings by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Aarons Holdings' Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Aarons Holdings' earnings, one of the primary drivers of an investment's value.

Aarons Current Ratio vs. EBITDA

EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It is a measure of a company operating cash flow based on data from the company income statement and is a very good way to compare companies within industries or across different sectors. However, unlike Operating Cash Flow, EBITDA does not include the effects of changes in working capital.
Aarons Holdings 
EBITDA 
 = 
Revenue 
-  
Basic Expenses 
802.56 M
In a nutshell, EBITDA is calculated by adding back each of the excluded items to the post-tax profit, and can be used to compare companies with very different capital structures.
Current Ratio is calculated by dividing the Current Assets of a company by its Current Liabilities. It measures whether or not a company has enough cash or liquid assets to pay its current liability over the next fiscal year. The ratio is regarded as a test of liquidity for a company.
Aarons Holdings 
Current Ratio 
 = 
Current Asset 
Current Liabilities 
3.54 X
Typically, short-term creditors will prefer a high current ratio because it reduces their overall risk. However, investors may prefer a lower current ratio since they are more concerned about growing the business using assets of the company. Acceptable current ratios may vary from one sector to another, but the generally accepted benchmark is to have current assets at least as twice as current liabilities (i.e., Current Ration of 2 to 1).

Aarons Current Ratio Comparison

Aarons Holdings is currently under evaluation in current ratio category among related companies.

Aarons Holdings Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Aarons Holdings, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Aarons Holdings will eventually generate negative long term returns. The profitability progress is the general direction of Aarons Holdings' change in net profit over the period of time. It can combine multiple indicators of Aarons Holdings, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for 2022
Accumulated Other Comprehensive Income-739 K-797.3 K
Consolidated Income109.9 M118.6 M
Net Income109.9 M118.6 M
Net Income Common Stock109.9 M118.6 M
Operating Income145.7 M157.3 M
Income Tax Expense35.9 M38.8 M
Net Income Per Employee-37.7 K-38.7 K
The Aarons Company, Inc. provides lease-to-own and purchase solutions. The Aarons Company, Inc. was founded in 1955 and is headquartered in Atlanta, Georgia. Aarons Holdings operates under Specialty Retail classification in the United States and is traded on New York Stock Exchange. It employs 9170 people.

Aarons Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Aarons Holdings. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Aarons Holdings position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Aarons Holdings' important profitability drivers and their relationship over time.

Aarons Holdings Profitability Trends

Aarons Holdings profitability trend refers to the progression of profit or loss within a business. An upward trend means that Aarons Holdings' profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Aarons Holdings' gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Aarons Holdings Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Aarons Holdings different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Aarons Holdings in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Aarons Holdings' future profitability.

Use Aarons Holdings in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Aarons Holdings position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Aarons Holdings will appreciate offsetting losses from the drop in the long position's value.

Aarons Holdings Pair Trading

Aarons Holdings Pair Trading Analysis

The ability to find closely correlated positions to Aarons Holdings could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Aarons Holdings when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Aarons Holdings - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Aarons Holdings to buy it.
The correlation of Aarons Holdings is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Aarons Holdings moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Aarons Holdings moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Aarons Holdings can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Aarons Holdings position

In addition to having Aarons Holdings in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Retail Thematic Idea Now

Retail
Retail Theme
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Retail theme has 61 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Retail Theme or any other thematic opportunities.
View All  Next Launch
Please continue to Trending Equities. Note that the Aarons Holdings information on this page should be used as a complementary analysis to other Aarons Holdings' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Probability Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

Complementary Tools for Aarons Stock analysis

When running Aarons Holdings price analysis, check to measure Aarons Holdings' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Aarons Holdings is operating at the current time. Most of Aarons Holdings' value examination focuses on studying past and present price action to predict the probability of Aarons Holdings' future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Aarons Holdings' price. Additionally, you may evaluate how the addition of Aarons Holdings to your portfolios can decrease your overall portfolio volatility.
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Go
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
ETF Directory
Find actively traded Exchange Traded Funds (ETF) from around the world
Go
Global Correlations
Find global opportunities by holding instruments from different markets
Go
To fully project Aarons Holdings' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Aarons Holdings at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Aarons Holdings' income statement, its balance sheet, and the statement of cash flows.
Potential Aarons Holdings investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Aarons Holdings investors may work on each financial statement separately, they are all related. The changes in Aarons Holdings's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Aarons Holdings's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.