United Rentals Surges to New Heights Despite Slight Q3 Setback
Company Overview
Currently valued at $56.4 billion, Stamford, Connecticut-based United Rentals, Inc. (URI) stands as the largest equipment rental company globally. The firm supports various sectors including construction, utilities, municipalities, homeowners, and communities through its extensive network of 1,666 rental locations across North America, Europe, Australia, and New Zealand.
Market Position and Recent Performance
As a “large-cap stock,” United Rentals is a significant player in the market, backed by its wide-ranging services and extensive equipment inventory. The company employs over 26,600 people and offers nearly 4,800 types of rental equipment, with a total original value of about $21.9 billion.
On November 11, United Rentals reached an all-time high of $896.98 and is currently trading 4.2% lower than that peak. Over the last three months, URI stock has climbed 26.1%, significantly outpacing the S&P 500 Index’s gains of 12.6% during the same period.
Impressive Year-to-Date Growth
Looking at the bigger picture, United Rentals has displayed noteworthy performance. The stock price rose by 49.8% year-to-date and an impressive 80.3% over the past year, outshining the S&P 500 Index, which saw returns of 27.7% in 2024 and 33.9% over the previous year.
Confirming the upward trend, URI stock has consistently traded above its 200-day moving average over the last year and above its 50-day moving average since mid-July, albeit with some fluctuations.
Q3 Performance Analysis
Despite the overall strength, URI stock experienced a 1.1% drop following the release of its Q3 results on October 23. The company reported an adjusted EPS of $11.80, which fell short of Wall Street estimates by 5.5%. In the quarter, profitability took a slight hit as equipment rental costs rose 8.2% from a year earlier, totaling approximately $1.4 billion. This contributed to a modest increase in net income to $708 million, despite strong revenue growth.
Nonetheless, United Rentals demonstrated resilience with total revenues jumping over 6% from the previous year to approximately $4 billion. Additionally, cash flow from operations increased by 13.4% year-over-year to $1.2 billion. The company remains optimistic about its long-term growth trajectory, world-class service, and innovative solutions aimed at delivering sustainable value for shareholders, reaffirming its full-year guidance across all metrics.
Competitive Landscape
United Rentals has substantially outperformed its competitor, H&E Equipment Services, Inc. (HEES), which saw stock gains of 14.7% year-to-date and 30.6% over the past year.
Among the 19 analysts following URI stock, the consensus rating stands at “Moderate Buy.” Presently, the stock is trading slightly above its average price target of $832.67.
On the date of publication, Aditya Sarawgi did not hold any positions in the securities mentioned in this article. All information is for informational purposes only. For more information, please view the Barchart Disclosure Policy here.
The views expressed in this article are those of the author and do not necessarily reflect those of Nasdaq, Inc.
