Upbound Group (NASDAQ:UPBD) Shares Gap Up Following Strong Earnings

Key Points

• Upbound Group shares rose 10.9% after the company reported quarterly EPS of $1.01, exceeding the $0.91 consensus estimate, while revenue of $1.15 billion also topped expectations. However, revenue declined 1.3% year over year.
• The company declared a quarterly dividend of $0.39, equivalent to an annualized $1.56 payout and an 8.3% yield; its payout ratio stands at 101.3%.
• Analyst sentiment remains cautious, with a consensus “Hold” rating and an average price target of $27.50. Institutional investors own 90.3% of the stock, while an executive recently sold 10,000 shares.

Shares of Upbound Group, Inc. (NASDAQ:UPBD - Get Free Report) gapped up before the market opened on Thursday following a better than expected earnings announcement. The stock had previously closed at $16.91, but opened at $18.00. Upbound Group shares last traded at $18.6740, with a volume of 305,818 shares.

The company reported $1.01 earnings per share for the quarter, beating analysts' consensus estimates of $0.91 by $0.10. The business had revenue of $1.15 billion during the quarter, compared to analyst estimates of $1.12 billion. Upbound Group had a net margin of 1.90% and a return on equity of 34.53%. The business's revenue was down 1.3% on a year-over-year basis. During the same period last year, the business earned $1.00 EPS.

Upbound Group Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Tuesday, October 27th. Shareholders of record on Tuesday, October 6th were paid a $0.39 dividend. The ex-dividend date was Tuesday, October 6th. This represents a $1.56 dividend on an annualized basis and a yield of 8.3%. Upbound Group's payout ratio is 101.30%.

Wall Street Analyst Weigh In

Several analysts have recently weighed in on UPBD shares. BTIG Research cut shares of Upbound Group from a "buy" rating to a "neutral" rating and set a $28.00 target price for the company. in a research note on Friday, July 31st. Zacks Research upgraded Upbound Group from a "strong sell" rating to a "hold" rating in a report on Monday, September 28th. TD Cowen cut their price objective on Upbound Group from $28.00 to $27.00 and set a "buy" rating for the company in a report on Tuesday, October 6th. Wall Street Zen downgraded shares of Upbound Group from a "buy" rating to a "hold" rating in a report on Saturday, October 24th. Finally, Weiss Ratings lowered shares of Upbound Group from a "hold (c)" rating to a "hold (c-)" rating in a research report on Monday, September 21st. One analyst has rated the stock with a Buy rating and three have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, the stock currently has a consensus rating of "Hold" and an average price target of $27.50.

Insider Activity

In other news, EVP Anthony Blasquez sold 10,000 shares of the stock in a transaction dated Friday, August 21st. The shares were sold at an average price of $18.85, for a total value of $188,500.00. Following the sale, the executive vice president directly owned 43,717 shares of the company's stock, valued at approximately $824,065.45. This represents a 18.62% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. 1.20% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently made changes to their positions in UPBD. BlackRock Inc. bought a new stake in Upbound Group in the 2nd quarter worth approximately $194,216,000. Dimensional Fund Advisors LP boosted its holdings in Upbound Group by 15.8% during the 1st quarter. Dimensional Fund Advisors LP now owns 2,394,770 shares of the company's stock valued at $43,227,000 after acquiring an additional 327,203 shares during the period. Ieq Capital LLC bought a new stake in Upbound Group during the 2nd quarter valued at $37,565,000. Bank of New York Mellon Corp bought a new position in Upbound Group in the second quarter worth approximately $18,862,000. Finally, Pacer Advisors Inc. acquired a new stake in Upbound Group in the first quarter valued at approximately $7,455,000. Hedge funds and other institutional investors own 90.30% of the company's stock.

Upbound Group Trading Up 10.9%

The company has a debt-to-equity ratio of 1.94, a current ratio of 3.22 and a quick ratio of 0.97. The stock has a market cap of $1.09 billion, a price-to-earnings ratio of 12.12 and a beta of 1.78. The company's fifty day moving average price is $17.18 and its 200-day moving average price is $18.87.

Upbound Group Company Profile

Upbound Group, Inc is a provider of consumer leasing and retail solutions, operating primarily through its Rent-A-Center and Acima brands. The company enables customers to obtain merchandise through flexible lease-to-own agreements and related payment options, serving consumers who may prefer alternatives to traditional retail financing.

Its Rent-A-Center business operates company-owned and franchised locations, as well as digital channels, offering furniture, appliances, electronics, computers, smartphones and other household goods.

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