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AAN Aarons

Aaron's, Inc. retails consumer electronics, computers, residential furniture, household appliances, and accessories. It engages in the lease ownership, lease and retail sale of products such as widescreen and liquid crystal display televisions, computers, living room, dining room and bedroom furniture, washers, dryers, and refrigerators. The company operates through the following business segments: Progressive Leasing, Aaron’s Business and Vive. The Progressive Leasing segment provides lease-purchase solutions on a variety of products, including furniture and appliance, jewelry, mobile phones and accessories, mattress, and automobile electronics and accessories. The Aaron’s Business segment offers furniture, home appliances, consumer electronics and accessories to consumers with a lease-to-own agreement. The Vive segment offers a variety of second-look financing programs originated through third-party federally insured banks to customers of participating merchants and, together with Progressive Leasing, allows the Company to provide retail partners. The company was founded by R. Charles Loudermilk, Sr. in 1955 and is headquartered in Atlanta, GA.

Company profile

Ticker
AAN
Exchange
Website
CEO
John W. Robinson
Employees
Incorporated
Location
Fiscal year end
Former names
AARON RENTS INC
SEC CIK
IRS number
580687630

AAN stock data

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Calendar

29 Jul 20
28 Jul 21
31 Dec 21
Quarter (USD)
Jun 20 Mar 20 Sep 19 Jun 19
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD)
Dec 19 Dec 18 Dec 17 Dec 16
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS

Financial data from Aarons earnings reports.

Cash burn rate (estimated) Burn method: Change in cash Burn method: Operating income/loss Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 313.06M 313.06M 313.06M 313.06M 313.06M 313.06M
Cash burn (monthly) 79.32M (positive/no burn) (positive/no burn) 16.68M (positive/no burn) (positive/no burn)
Cash used (since last report) 1.03B n/a n/a 215.83M n/a n/a
Cash remaining -713.57M n/a n/a 97.23M n/a n/a
Runway (months of cash) -9.0 n/a n/a 5.8 n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
13 Aug 20 Sinclair Robert P JR Common Stock Sell Dispose S No No 58.35 3,500 204.23K 6,216
13 Aug 20 Sinclair Robert P JR Common Stock Option exercise Aquire M No No 47.26 1,960 92.63K 9,716
13 Aug 20 Sinclair Robert P JR Common Stock Option exercise Aquire M No No 27.18 1,540 41.86K 7,756
13 Aug 20 Sinclair Robert P JR Stock Options Common Stock Option exercise Dispose M No No 47.26 1,960 92.63K 980
13 Aug 20 Sinclair Robert P JR Stock Options Common Stock Option exercise Dispose M No No 27.18 1,540 41.86K 0
12 Aug 20 Doman Curtis Linn Common Stock Sell Dispose S No No 59.57 6,085 362.48K 140,049
12 Aug 20 Doman Curtis Linn Common Stock Sell Dispose S No No 59.11 99,905 5.91M 146,134
12 Aug 20 Doman Curtis Linn Common Stock Option exercise Aquire M No No 27.18 33,990 923.85K 246,039
12 Aug 20 Doman Curtis Linn Common Stock Option exercise Aquire M No No 22.64 42,000 950.88K 212,049
12 Aug 20 Doman Curtis Linn Common Stock Option exercise Aquire M No No 32.2 30,000 966K 170,049

Data for the last complete 13F reporting period. To see the most recent changes to ownership, click the ownership history button above.

13F holders
Current Prev Q Change
Total holders 0 0
Opened positions 0 0
Closed positions 0 265 EXIT
Increased positions 0 0
Reduced positions 0 0
13F shares
Current Prev Q Change
Total value 0 0
Total shares 0 0
Total puts 0 0
Total calls 0 0
Total put/call ratio
Largest owners
Shares Value Change
Largest transactions
Shares Bought/sold Change

Financial report summary

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Risks
  • Federal and state regulatory authorities are increasingly focused on our industry, and in addition to being subject to various existing federal and state laws and regulations, we may be subject to new or additional federal and state laws and regulations (or changes in interpretations of existing laws and regulations) that could expose us to government investigations, significant additional costs or compliance-related burdens that could force us to change our business practices in a manner that may be materially adverse to our operations, prospects or financial condition.
  • The effects on our business of our announcement of Progressive Leasing’s proposed settlement with the FTC are not certain; it may have a material adverse effect on our reputation, business, and financial results, as could our failure to comply with the settlement.
  • Progressive Leasing's virtual lease-to-own business, as well as our e-commerce-based business, differs in some potentially significant respects from the risks of the traditional store-based Aaron's Business lease-to-own business. The risks could have a material negative effect on Progressive Leasing, which could result in a material adverse effect on our entire business.
  • Progressive Leasing’s loss of operating revenues from key retail partners could materially and adversely affect our business.
  • We continue to implement an aggressive strategic plan within the Aaron’s Business and there is no guarantee that it will be successful.
  • Our Aaron’s Business faces many challenges which could materially and adversely affect our overall results of operations, including the commoditization of certain product categories; increasing competition from a growing variety of sources; a decentralized, high-fixed-cost operating model; adverse consequences to our supply chain function from decreased procurement volumes; increasing costs for labor and transportation; and lower lease volumes on important categories such as consumer electronics.
  • The transactions offered to consumers by our businesses may be negatively characterized by consumer advocacy groups, the media and certain federal, state and local government officials, and if those negative characterizations become increasingly accepted by consumers and/or Progressive Leasing’s or Vive’s retail and merchant partners, demand for our goods and the transactions we offer could decrease and our business could be materially adversely affected.
  • From time to time we are subject to regulatory and legal proceedings which seek material damages or seek to place significant restrictions on our business operations. These proceedings may be negatively perceived by the public and by Progressive Leasing’s existing and prospective retail partners, and materially and adversely affect our business.
  • Certain judicial or regulatory decisions may restrict or eliminate the enforceability of certain types of contractual provisions designed to limit costly litigation, including class actions, as a dispute resolution method.
  • Our competitors could impede our ability to attract new customers, or cause current customers to cease doing business with us.
  • If we do not maintain the privacy and security of customer, retail partner, employee or other confidential information, due to cybersecurity-related “hacking” attacks, intrusions into our systems by unauthorized parties or otherwise, we could incur significant costs, litigation, regulatory enforcement actions and damage to our reputation, any one of which could have a material adverse impact on our business, operating results and financial condition.
  • Our proprietary algorithms and customer lease decisioning tools used to approve customers could no longer be indicative of our customers’ ability to perform under their lease agreements with us.
  • We could lose our access to data sources, which could cause us competitive harm and have a material adverse effect on our business, operating results, and financial condition.
  • If our information technology systems are impaired, our business could be interrupted, our reputation could be harmed and we may experience lost revenues and increased costs and expenses.
  • We may pursue acquisitions or investments of complementary companies or businesses, and the failure of an acquisition or investment to produce the anticipated results or the inability to fully integrate the acquired companies could have an adverse impact on our business.
  • Our stock price is volatile, and you may not be able to recover your investment if our stock price declines.
  • We may engage in litigation with our franchisees.
  • We must successfully order and manage our Aaron’s Business inventory to reflect customer demand and anticipate changing consumer preferences and buying trends or our revenue and profitability will be adversely affected.
  • We depend on hiring an adequate number of hourly employees to run our business and are subject to government regulations concerning these and our other employees, including wage and hour regulations.
  • The geographic concentration of our Aaron’s stores, as well as those of Progressive Leasing’s retail partners, may magnify the impact of conditions in a particular region, including economic downturns and other occurrences.
  • Vive’s “second-look” credit programs for below-prime consumers differ in significant respects from the risks of Aaron’s store-based lease-to-own business. The risks could have a material negative effect on Progressive Leasing, which could result in a material adverse effect on our entire business.
  • The loss of the services of our key executives, or our inability to attract and retain key talent could have a material adverse impact on our operations.
  • If we fail to establish and maintain effective internal control over financial reporting and disclosure controls and procedures, we may not be able to accurately report our financial results, or report them in a timely manner.
  • Operational and other failures by our franchisees may adversely impact us.
  • We are subject to laws that regulate franchisor-franchisee relationships. Our ability to enforce our rights against our franchisees may be adversely affected by these laws, which could impair our growth strategy and cause our franchise revenues to decline.
  • Changes to current law with respect to the assignment of liabilities in the franchise business model could adversely impact our profitability.
  • We are subject to sales, income and other taxes, which can be difficult and complex to calculate due to the nature of our various businesses. A failure to correctly calculate and pay such taxes could result in substantial tax liabilities and a material adverse effect on our results of operations.
  • Employee misconduct or misconduct by third parties acting on our behalf, or third parties to whom our Aaron’s Business previously sold certain of its past due customer accounts for the third parties to attempt to collect, could harm us by subjecting us to monetary loss, significant legal liability, regulatory scrutiny and reputational harm.
  • Product safety and quality control issues, including product recalls, could harm our reputation, divert resources, reduce sales and increase costs.
  • We may be alleged to have infringed upon intellectual property rights owned by others, or may be unable to protect our intellectual property.
  • Interest rates on certain of our outstanding indebtedness are tied to LIBOR and may be subject to change.
Management Discussion
  • 1 For the year ended December 31, 2019, the Progressive Leasing provision for returns and uncollectible renewal payments was $274.9 million which was recorded as a reduction to Lease Revenues and Fees as a result of the Company's adoption of ASC 842, Leases. See Note 1 in the accompanying consolidated financial statements for more information regarding the impacts of ASC 842 on the Company's financial results.
  • 1 See the "Use of Non-GAAP Financial Information" section below.
  • Progressive Leasing. Progressive Leasing segment revenues increased primarily due to an annualized 22.3% increase in total invoice volume, which was driven mainly by an increase in invoice volume per active door. The increase was partially offset by the recognition of a provision for returns and uncollectible renewal payments of $274.9 million as a reduction to lease revenues in accordance with ASC 842 beginning in 2019. Calculated on a basis consistent with the January 2019 adoption of ASC 842, Progressive Leasing revenues increased 20.2% during the year ended December 31, 2019 as compared to the prior year.
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