Collins Stewart Starts Aaron's (AAN) at Buy; Our Model Projects EPS Will Increase at 5-Yr CAGR of 11%
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Price: $10.09 --0%
Rating Summary:
4 Buy, 11 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
4 Buy, 11 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Collins Stewart initiates coverage on Aaron's (NYSE: AAN) with a Buy. PT $29.00.
Collins analyst says, "Rentals are primarily offered on a monthly-contract basis and include the option to return the item, purchase the product outright, or pay through the full term of the lease. This has translated to same-store revenue gains and increased comparable-store customer counts for AAN in FY11. We expect AAN to continue to expand its store base in the MSD range on an annual basis out to FY15, and we look for EPS to increase at a five-year CAGR of 11%. AAN shares appear attractively valued given the company’s growth prospects. The stock currently trades at 13.5x our FY12 EPS estimate and 7x FY12E EV/EBITDA...We look for FY11 SSS growth of 5.1% on top of +4.1."
"For FY11, AAN guided for EPS of $1.73-$1.77, which is $0.04 lower on the top end. We estimate total revenues will increase 7.7% yr./yr. to $2.02B. Our estimates call for AAN to generate 120bps of operating expense leverage in FY11. We are calling for EPS of $1.76, one penny ahead of consensus."
For an analyst ratings summary and ratings history on Aaron's click here. For more ratings news on Aaron's click here.
Shares of Aaron's closed at $26.20 yesterday.
Collins analyst says, "Rentals are primarily offered on a monthly-contract basis and include the option to return the item, purchase the product outright, or pay through the full term of the lease. This has translated to same-store revenue gains and increased comparable-store customer counts for AAN in FY11. We expect AAN to continue to expand its store base in the MSD range on an annual basis out to FY15, and we look for EPS to increase at a five-year CAGR of 11%. AAN shares appear attractively valued given the company’s growth prospects. The stock currently trades at 13.5x our FY12 EPS estimate and 7x FY12E EV/EBITDA...We look for FY11 SSS growth of 5.1% on top of +4.1."
"For FY11, AAN guided for EPS of $1.73-$1.77, which is $0.04 lower on the top end. We estimate total revenues will increase 7.7% yr./yr. to $2.02B. Our estimates call for AAN to generate 120bps of operating expense leverage in FY11. We are calling for EPS of $1.76, one penny ahead of consensus."
For an analyst ratings summary and ratings history on Aaron's click here. For more ratings news on Aaron's click here.
Shares of Aaron's closed at $26.20 yesterday.
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