I would take it out of that decorative pot and use a saucer instead. I water my aloe when the soil looks dry. If I were you I'd not water it for at least 2 weeks. It is a succulent, so it will survive. With most of my plants I can tell if they need water by lifting there pots up. If your doesn't have drainage you should repot it.

Ignore the bit about the sand, but you're good to go if you follow the advice laden out here Aloe FAQ

It does look like mechanical damage. The reason it is deflating around the hole - the plant is sealing off the damage so it will not loose any water/fluid. Perhaps the plant was poked by a neighboring plant before you purchased it. Or maybe it got poked when you transported it home or when you repotted it. And I won't eliminate the cat possibility, either. LOL On the up side, new growth should be just fine and will eventually replace the damaged leaves.

Okay, I understand. I'm going to keep these two in pretty small pots until they have more roots established. I don't mean tiny pots- just like medium sized I would say. And I will add some small rocks to the top in order to stabilize the plants. Today I unpotted both of my aloes to see how much damage there could be and if any, it would allow me to remove the damage and let them callus over before repotting this weekend or so. The roots of the smaller aloe look pretty good to me- there is plenty of new growth (including new baby roots and additional growth on the longer, older ones). This was the aloe with the two leaves on the bottom that turned yellow and shriveled up- which I was told was normal and the plant was just shedding the older leaves. These leaves were easily removed from the base with gentle pulling. Just wondering if you guys agree with me and the roots look good and this one can be planted as normal in the new gritty soil. Two pictures of the smaller aloe: Next, was the bigger aloe which I wasn't happy with. As can be expected, it's roots did suffer. So I trimmed off the dying roots and was left with barely anything. But I was happy to see it has one new root growing! So there is something left there (: My question with this one is should I remove the dark part of old stem that is under the baby root? I don't know if this is rotten or not, it's soft and dark but not mushy or smelly. I'm thinking I should remove it because it's not doing any good but will that much trauma to the plant cause more suffering? Bigger aloe: One more thing, I read about putting cinnamon on any cuts or damage upon transplanting in order to prevent infection. Should this be done immediately or after the plant has had some time to callus? Thanks in advance for any help (: