Aaron’s Earnings: The Profit Streak Continues

Aaron’s Inc. (NYSE:AAN) reported its results for the second quarter. Aaron’s is engaged in the sales and lease ownership, specialty retailing and rental of residential and office furniture, consumer electronics and home appliances and accessories.

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Aaron’s Inc. Earnings Cheat Sheet

Results: Net income for Aaron’s Inc. rose to $36.2 million (47 cents per share) vs. $10.8 million (13 cents per share) in the same quarter a year earlier. This is a more than threefold rise from the year-earlier quarter.

Revenue: Rose 11.8% to $539.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Aaron’s Inc. fell in line with the mean analyst estimate of 47 cents per share. It beat the average revenue estimate of $524.7 million.

Quoting Management: “Once again we are announcing outstanding financial results, which were in line with our expectations,” said Ronald W. Allen, President and Chief Executive Officer of Aaron’s. “We continue to grow in revenues, earnings, customers, and store count. Regardless of the current economic times, customer demand remains strong in both our Company-operated and franchised stores. Our unique business model provides high-quality, basic household furnishings that are desired by our customers, and our superior service and flexible payment terms enable them to obtain these needed products. We are optimistic that business will continue to be strong for the rest of the year.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 10.2% to $586.9 million in the first quarter. The figure rose 8.1% in the fourth quarter of the last fiscal year from the year earlier and climbed 7.3% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell in line with estimates last quarter after beating forecasts in the previous quarter with net income of 64 cents versus a mean estimate of net income of 60 cents per share.

Net income has increased 49.3% year-over-year on average across the last five quarters. The biggest gain came in the most recent quarter, when income climbed more than threefold from the year-earlier quarter.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the third quarter is 43 cents per share, up from 42 cents ninety days ago. For the fiscal year, the average estimate has moved up from $1.96 a share to $2.03 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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