PROG Holdings stock hits 52-week low at $28.95 amid market shifts

PROG Holdings Inc. shares have touched a 52-week low, dipping to $28.95, marking a significant 31% decline over the past week. According to InvestingPro analysis, the stock appears undervalued, with a P/E ratio of 8.1x and strong fundamentals including a healthy current ratio of 4.0x. The company, known for its lease-purchase solutions, has faced headwinds over the past year, though maintaining profitability with a return on equity of 32%. This latest price level represents a critical juncture for the company’s stock, with InvestingPro data showing the RSI in oversold territory and management actively buying back shares. The 52-week low milestone is a significant marker for PROG Holdings, as it navigates through a competitive landscape and strives to adapt to the evolving demands of the market. For deeper insights, investors can access 12 additional ProTips and comprehensive analysis through the Pro Research Report, available exclusively on InvestingPro.

In other recent news, PROG Holdings’ fourth-quarter results for 2024 exceeded expectations, with revenues and gross margins modestly surpassing projections. The company’s performance aligned with the higher end of management’s guidance, showcasing its financial resilience. However, the outlook for 2025 appears less optimistic, influenced by the bankruptcy of Big Lots (NYSE:BIG) and increased marketing investments. These factors, along with a slight uptick in consumer delinquencies, have contributed to a more cautious forecast.

Raymond (NSE:RYMD) James analyst Bobby Griffin reduced the price target for PROG Holdings from $48 to $40, though the firm maintained its Outperform rating. Despite the stock experiencing a significant decline of approximately 28% following the guidance update, Griffin highlighted the company’s strong balance sheet and cash flow generation. This financial strength allows for potential additional share repurchases, which have not been included in the current guidance.

Furthermore, the company is expected to see high single-digit growth in first-quarter Gross Merchandise Volume, excluding the impact of Big Lots. The analyst emphasized that the risk/reward profile for PROG Holdings remains compelling, with the trading price below both the three-year and one-year median earnings per share estimates.

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