) has priced a new $250 million senior unsecured notes offering,
which is expected to commence on May 2, 2013. The debt offering
has been priced at an interest rate of 4.75% per annum, with
maturity due in 2021.
AMER CAP LTD (ACAS): Free Stock Analysis
AEROCENTURY CP (ACY): Get Free Report
KCAP FINL INC (KCAP): Free Stock Analysis
RENT-A-CENTER (RCII): Free Stock Analysis
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The notes under the private offering will be issued to qualified
institution investors and non-U.S. investors who are exempted
from registration under the Securities Act of 1933.
The funds raised from the offering are expected to be used for
repayment of the company's loans under its revolving credit
facility worth $46 million. The remainder of the proceeds will be
directed toward enhancing shareholder value by buying back shares
and for general development of its business.
Rent-A-Center has a consistent track record of returning cash to
its shareholders in the form of share repurchase and dividend
payment. Earlier this week, the company enhanced its current
share repurchase authorization to $1.25 billion from $1 billion.
Since the inception of the share buyback program, the company has
repurchased 31,585,314 shares for approximately $794.8 million.
Moreover, it bought back 465,035 shares for approximately $17.4
million during the last reported quarter.
Additionally, the company has been paying regular quarterly
dividends to its shareholders over the past few years. Since the
inception of its dividend program, the company has raised its
dividend rate from the initial 6 cents per share to the current
21 cents per share, the last upside being announced in Dec 2012.
This brings the company's annual dividend rate to 84 cents per
share, with the payout ratio currently standing at 2.44%.
Rent-A-Center offers consumer electronics, appliances and
furniture products under rental purchase schemes that allow
customers to own the merchandise upon completion of the rental
period. Due to continued tightening of the credit market,
customers see rent-to-own as a more flexible and viable option
compared to credit. However, the sluggish recovery and a fragile
job market may make customers reluctant to enter new
Currently, Rent-A-Center holds a Zacks Rank #4 (Sell). Other
stocks worth considering in the finance-leasing industry are
KCAP Financial Inc.
American Capital Ltd.
), all holding a Zacks Rank #1 (Strong Buy).