Jeffrey Brown, a director at Rent-A-Center (RCII), recently bought 1,084 shares. The buy increased his holdings by just over 1 percent, and came to a total cost of $26,233.
The director has been a quarterly buyer of shares going back to 2021. Other company insiders have been slight buyers, with a CEO buy of 40,000 shares for $1.08 million last March. The last insider sale occurred in December 2021.
Overall, Rent-A-Center insiders own 11 percent of shares.
The rental and leasing service company has dropped 44 percent in the past year on fears of a slowing economy. Revenues are off 13 percent, and earnings have slid in the past year as well.
However, shares trade at 6 times forward earnings, and the company now trades for 0.35 times its price-to-sales. While the economy is slowing, the company’s rental purchase business can benefit from higher interest rates, even if overall volume drops, as profit margins can expand.
Action to take: Shares have started to trend higher in recent months, and can likely continue to do so. Shares yield about 5.3 percent at current prices, offering a high payout for patient investors.
For traders, the June $30 calls, last going for about $1.65, can offer mid-to-high double-digit returns on a further rally higher for shares.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.