Spinoff spotlight: Aaron’s Company

Article Excerpt

AARON’S COMPANY INC. $10 is a hold. The company (New York symbol AAN; Consumer sector; Shares outstanding: 30.6 million; Market cap: $306.0 million; Dividend yield: 5.0%; Takeover Target Rating: Highest; www.aarons.com) sells furniture and electronics through 1,220 company-owned and franchised stores in the U.S. and Canada. It sells these goods under a “rent-to-own” model, where customers make payments over a fixed term and take full ownership at the end of the contract. In December 2020, the old Aaron’s Inc. set up its rent-to-own business as a separate firm called Aaron’s Company. Investors received one share in the new firm for every two shares they held. The old Aaron’s then changed its name to PROG Holdings Inc. (New York symbol PRG). PROG provides leasing and other financial services to consumers. Aaron’s has now accepted a $10.10-a-share takeover offer from fintech firm IQVentures. If shareholders and regulators approve, IQVentures expects to complete the transaction by the end of 2024. The takeover price is 34% higher than Aaron’s closing share price…