United Rentals edged past second-quarter earnings estimates late Wednesday, while sticking by its full-year outlook at the midpoint. URI stock rose in early Thursday stock market action, after falling below a buy point Wednesday.
"We continue to see particular strength in large projects and believe we are uniquely positioned to capitalize on these opportunities," Matthew Flannery, CEO of the Stamford, Conn., equipment rental giant, said in the earnings statement.
The take-away is that major projects are holding strong, likely thanks to a government funding tailwind from the Inflation Reduction Act and CHIPS Act. But higher interest rates for longer have restricted funds for smaller projects.
United Rentals Earnings
Estimates: Analysts expected Q2 earnings per share of $10.55, up 6.7% from a year ago. Revenue was seen growing 6.2% to $3.775 billion.
Results: United Rentals posted adjusted EPS of $10.70, up 8.3% from a year ago in a continued deceleration. Sales missed by a hair, growing 6.2% to $3.773 billion.
Outlook: For the full year, URI affirmed the midpoint of its outlook for revenue and adjusted earnings before interest, depreciation and amortization. Revenue should range from $15.05 billion to $15.35 billion vs. the prior outlook of $14.95 billion to $15.45 billion. Adjusted EBITDA should finish the year between $7.09 billion and $7.24 billion, narrowed from the prior outlook of $7.04 billion to $7.29 billion.
Both midpoints hew very closely to the analyst consensus of $15.21 billion for sales and $7.162 billion for EBITDA.
URI Stock
United Rentals rose 1.1% to 724 on Thursday morning. During Wednesday's regular session, URI lost 3.8% to 715.82, slipping below a 732.37 buy point from a 19-week consolidation.
Caterpillar, which is more of a global bellwether than URI, fell 2.4% to 336.04 on Wednesday, slipping below its 50-day moving average. The Dow Jones construction and mining equipment giant will report its Q2 results on Aug. 6.
Be sure to read IBD's The Big Picture column after each trading day to get the latest on the prevailing stock market trend and what it means for your trading decisions.
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