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Aaron's Offers Protective Equipment Amid Coronavirus Crisis

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Aaron's, Inc. (AAN - Free Report) informed that its Woodhaven Furniture manufacturing unit (located in Coolidge, Georgia) has converted the production capacity to manufacture personal protective equipment (PPE) to donate to the local medical centers. These include sheets, masks and gowns. In fact, Aaron’s has collaborated with healthcare organization, PruittHealth, to offer protective cloth masks with the growing spread of coronavirus.

Apart from this, the company is making efforts to offer hospital gowns, mattresses and bedding for medical and humanitarian requirements. Certainly, coronavirus has wreaked havoc everywhere, infecting more than a million people worldwide and the death toll crossing 60,000.

The virus has hit the retail sector hard, leading to store closures, limited hours of operations and major supply-chain hurdles. In fact, many companies had to withdraw their guidance as they are unable to gauge the impact of the crisis. Aaron’s is also one of them. In its Mar 23 press release, the company withdrew its 2020 guidance in response to the ongoing COVID-19 outbreak and its unpredictable impacts. Further, management said that it drew $300 million from its revolving credit facility to add to its cash balance.

Additionally, the company informed that the Aaron's Business segment will operate only online and curbside services, including order processing, merchandise pickup, returns and payments, until further notice.  Moreover, the company will continue to operate online offering the home delivery facility. However, all in-home installation services will not be available until further notice.

Several other retailers like Nordstrom (JWN - Free Report) , Kohl's (KSS - Free Report) and Ulta Beauty (ULTA - Free Report) to name a few, closed stores and withdrew their guidance in the wake of coronavirus. Meanwhile, Aaron’s has already been seeing softness in the Aaron’s Business. This segment’s total revenues fell 5.4% in the fourth quarter on lack of revenues from net closure of 145 stores in 2019 and revenue attrition from prior-year store mergers and lower collections.

Let’s see how the coronavirus-led changes impact the company’s performance. Shares of this Zacks Rank #4 (Sell) company have slumped 62.2% in the past three months compared with the industry’s 41.1% decline.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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