United Rentals Inc. (URI, Financial) reported first-quarter revenue of $3.719 billion, surpassing the market consensus estimate of $3.61 billion. This strong financial performance reflects robust demand across the company's construction and industrial sectors, which has positioned the company for a promising start to the year.
The company's leadership has expressed satisfaction with the results, which highlight both strong customer relations and operational efficiency. The first quarter marked a record in revenue as well as adjusted EBITDA, underscoring the company's commitment to growth and profitability.
Looking forward, United Rentals has confirmed that it will maintain its full-year guidance projections. This stance is supported by positive customer sentiment and the momentum the company has gained as it enters its peak season. These factors reinforce United Rentals' expectations for continued profitable growth throughout 2025.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 16 analysts, the average target price for United Rentals Inc (URI, Financial) is $696.57 with a high estimate of $974.00 and a low estimate of $485.00. The average target implies an upside of 18.22% from the current price of $589.21. More detailed estimate data can be found on the United Rentals Inc (URI) Forecast page.
Based on the consensus recommendation from 23 brokerage firms, United Rentals Inc's (URI, Financial) average brokerage recommendation is currently 2.4, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for United Rentals Inc (URI, Financial) in one year is $614.09, suggesting a upside of 4.22% from the current price of $589.21. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the United Rentals Inc (URI) Summary page.
Key Business Developments
Release Date: January 30, 2025
- Total Revenue: Grew 9.8% year over year to almost $4.1 billion.
- Rental Revenue: Increased by 9.7% to $3.4 billion.
- Fleet Productivity: Increased by 4.3% as reported.
- Adjusted EBITDA: Reached a record of $1.9 billion with a margin of over 46%.
- Adjusted EPS: Grew to $11.59, a fourth-quarter record.
- Specialty Rental Revenue: Grew more than 30% year over year.
- Used Equipment Sales: Generated over $850 million in the quarter.
- Free Cash Flow: Nearly $2.1 billion with a margin of over 13%.
- Shareholder Returns: Over $1.9 billion returned through share buybacks and dividends.
- Quarterly Dividend: Increased by 10% to $1.79 per share.
- Net Leverage: 1.8x at the end of December.
- Total Liquidity: Over $2.8 billion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- United Rentals Inc (URI, Financial) reported record fourth-quarter revenue of $4.1 billion, a 9.8% year-over-year increase.
- The company achieved a fourth-quarter record adjusted EBITDA of $1.9 billion, with a margin of over 46%.
- Specialty rental revenue grew impressively by more than 30% year over year.
- United Rentals Inc (URI) generated nearly $2.1 billion in free cash flow, translating to a healthy free cash flow margin of over 13%.
- The company announced a 10% increase in its quarterly dividend to $1.79 per share, reflecting confidence in future growth.
Negative Points
- The adjusted EBITDA margin experienced a compression of 210 basis points year over year.
- Used equipment sales contributed to a 9% decline in used gross profit dollars, impacting adjusted EBITDA.
- SG&A expenses increased by $36 million year over year, aligning with revenue growth but indicating higher operational costs.
- The company paused its share repurchase plan ahead of the H&E acquisition, potentially impacting shareholder returns.
- The ongoing normalization of the used equipment market presents a headwind to profitability.