Aaron’s, Inc. (AAN) Posts Earnings Beat, Raises Guidance, But Shares Drop: Time To Buy?

Hedge fund activity in Aaron’s, Inc. (NYSE:AAN)

According to Insider Monkey’s hedge fund database, First Pacific Advisors LLC, managed by Robert Rodriguez and Steven Romick, holds the most valuable position in Aaron’s, Inc. (NYSE:AAN). First Pacific Advisors LLC has around 1.7 million shares valued at $48.8 million, comprising 0.4% of its 13F portfolio at the end of March. The second-largest stake was held by Diamond Hill Capital, led by Ric Dillon, which held around 1.5 million shares valued at $41.7 million; the fund had 0.3% of its 13F portfolio invested in the stock. Remaining peers with similar optimism contain David E. Shaw’s D E Shaw, Jacob Doft’s Highline Capital Management, and Malcolm Fairbairn’s Ascend Capital.

As the stats suggest, some hedge fund managers opted to open fresh positions in the stock, whereas a few hedge funds either walked out of or decreased their positions in the stock. Renaissance Technologies, managed by Jim Simons, created the most valuable new position in Aaron’s, Inc. (NYSE:AAN), purchasing around 158,000 shares of the company during the first three months of the year. But, Alexander Mitchell’s Scopus Asset Management opted to walk out of the stock by selling all of its 656,400 shares during the same period. Also, Steve Cohen’s Point72 Asset Management held 854,000 shares by the end of March, which was well down from the 2.5 million shares held at the end of 2014. This is a significant back step by Cohen on the stock.

Many hedge fund managers like Steve Cohen and Alexander Mitchell were bearish on the stock, as they sold large positions in it during the first quarter, but leading hedge fund managers like Jim Simons opted to open fresh positions in the stock. Hedge fund activity on the stock during the second quarter might give more insights about the hedge fund sentiment for the stock. But considering the hedge funds’ bearish activities on the stock, and the market sentiment to the company’s latest earnings report, we don’t recommend buy the stock at the moment.

Disclosure: None