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United Rentals, Inc. (URI) is the largest equipment rental company in the world, with an integrated network of rental locations in the U.S., Canada and Europe. With a market cap of $56.2 billion, United Rentals operates through General Rentals and Specialty segments.
United Rental has substantially outpaced the broader market over the past year. URI stock has soared 49.5% in 2024 and 84.6% over the past 52-week period outperforming the S&P 500 Index’s ($SPX) 25.8% gains in 2024 and 31.8% returns over the past year.
Narrowing the focus, URI has also outpaced the Industrial Select Sector SPDR Fund’s (XLI) surge of 25.6% in 2024 and 35.4% over the past 52 weeks.
URI stock prices fell 1.1% in the trading session after the release of its Q3 earnings on Oct. 23 as the company’s earnings fell below Wall Street’s expectations. Its adjusted EPS grew by a modest 60 basis points compared to the year-ago quarter to $11.80, which missed analysts’ estimates by a notable 5.5% and unsettled investors' confidence.
Nevertheless, United Rentals' overall performance has remained resilient and reflected continued growth across both its construction and industrial end-markets, achieving record third-quarter results. The company reported over 6% year-over-year growth in total revenue, reaching approximately $4 billion, driven by the impressive 7.4% year-over-year growth in equipment rental revenue, totaling $3.5 billion.
For the current fiscal year, ending in December, analysts expect URI to report a 6.7% year-over-year growth in adjusted EPS to $43.46. The company has a mixed earnings surprise history. It surpassed analysts’ bottom-line estimates in three of the past four quarters while missing on another occasion.
URI stock has a consensus “Moderate Buy” rating overall. Out of the 19 analysts covering the stock, eight recommend “Strong Buy,” one advises “Moderate Buy,” six suggest “Hold,” and four advocate a “Strong Sell” rating.
This configuration is slightly more bullish than three months ago, when 18 analysts had a consensus “Hold” rating overall, among which seven analysts recommended a “Strong Buy” rating.
On Nov. 20, Argus Research analyst John Eade maintained a “Buy” rating and raised the price target to $880, indicating a 2.7% potential upside from current price levels.
As of writing, URI is trading above its mean price target of $832.67. Meanwhile, the Street-high target of $1004 represents a 17.2% premium to current price levels.
