Herc Holdings (HRI) AI Stock Analysis

• Market Cap: $3.78B
• Dividend Yield: 2.46%
• Average Volume (3M): 454.07K
• Price to Earnings (P/E): 25.4
• Beta (1Y): 1.58
• Revenue Growth: 8.34%
• EPS Growth: -63.02%
• Country: US
• Employees: 7,600
• Sector: Industrials
• Sector Strength: 87
• Industry: Rental & Leasing Services
• EPS (TTM): 1.30
• Shares Outstanding: 33,200,000
• 10 Day Avg. Volume: 436,713
• 30 Day Avg. Volume: 454,075
• PEG Ratio: 0.25
• Price to Book (P/B): 3.51
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -10.95
• Enterprise Value/Market Cap: 1.97
• Enterprise Value/Revenue: 0.55
• Enterprise Value/Gross Profit: 6.66
• Enterprise Value/Ebitda: 1.33
• 1Y Price Target: $130.83
• Price Target Upside: 14.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 66 Neutral
• Price Target: $125.00 ▲(9.75%Upside)

Herc Holdings' overall stock score reflects strong strategic moves through acquisitions and robust operational efficiency. However, challenges in profitability, weak technical indicators, and moderate valuation concerns weigh on the score. Near-term pressures from market conditions and financial constraints are notable, but long-term growth prospects remain solid.

Positive Factors

Acquisition Strategy

The pending acquisition of H&E presents attractive upside despite an uncertain near-term macro outlook.

Earnings and Margin Expansion

Herc's ability to capture deal synergies and realize outgrowth from solid mega project tailwinds provides a framework for a compelling earnings trajectory and margin expansion.

Negative Factors

Construction Market

Construction spending data remains sluggish, particularly in the local, ‘rate sensitive’ verticals.

Financial Performance

HRI shares underperformed following its 1Q25 EBITDA and Rental revenue miss.

Leverage Concerns

Herc's leverage remains at 2.5x at the end of 1Q25 and is expected to climb to 3.8x at the close of the H&E transaction.

Herc Holdings Business Overview & Revenue Model

Company Description

Herc Holdings Inc., through its subsidiaries, operates as an equipment rental supplier in the United States and internationally. It rents aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment. The company also provides ProSolutions, an industry specific solution-based services, which include power generation, climate control, remediation and restoration, pump, trench shoring, and studio and production equipment; and ProContractor professional grade tools. In addition, it offers various services, including repair, maintenance, equipment management, and safety training; and equipment re-rental and on-site support services, as well as ancillary services, such as equipment transport, rental protection, cleaning, refueling, and labor. Further, the company sells used equipment and contractor supplies, such as construction consumables, tools, small equipment, and safety supplies. It serves non-residential and residential construction, specialty trade, restoration, remediation and environment, and facility maintenance contractors; industrial manufacturing industries, including automotive and aerospace, power, metals and mining, agriculture, pulp, paper and wood, food and beverage, and refineries and petrochemical industries; infrastructure and government sectors; and commercial facilities, hospitality, healthcare, recreation, entertainment production, and special event management customers. The company sells its products through its sales team and industry catalogs, as well as through participation and sponsorship of industry events, trade shows, and Internet. Herc Holdings Inc. was founded in 1965 and is based in Bonita Springs, Florida.

How the Company Makes Money

Herc Holdings generates revenue primarily through the rental of equipment to a diverse customer base across numerous industries. Their business model focuses on renting out a wide array of equipment, which includes both short-term and long-term rental agreements. The company also supplements its rental income with sales of new and used equipment, repair and maintenance services, and ancillary support services. Key revenue streams include rental fees, sales of equipment, and service charges for maintenance and logistics. Strategic partnerships with equipment manufacturers and suppliers help Herc Holdings maintain a robust inventory and meet customer demand, which is crucial for sustaining and growing its revenue.

Herc Holdings Financial Statement Overview

Summary

Herc Holdings shows strong revenue growth and operational efficiency, with robust gross and EBIT margins. However, profitability is under pressure due to declining net profit margin and ROE. The balance sheet is stable with an improving debt-to-equity ratio, but negative free cash flow poses liquidity challenges.

Income Statement

Herc Holdings demonstrates strong revenue growth with a 25.3% increase in revenue from 2022 to TTM (Trailing-Twelve-Months). The gross profit margin remains robust at 49.6% in TTM. However, net profit margin has decreased to 3.7% in TTM from 6.3% in 2023, indicating some pressure on profitability. EBIT margin has improved significantly to 34.5% in TTM compared to previous years, showing better operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has improved, standing at 0.68 in TTM, indicating a healthy balance between debt and equity financing. ROE has decreased to 9.4% in TTM from 16.5% in 2023, reflecting reduced profitability relative to shareholders' equity. The equity ratio is stable at 17.6%, suggesting a solid equity base relative to total assets.

Cash Flow

Free cash flow is negative at -$13 million in TTM, signaling potential challenges in cash generation. The operating cash flow to net income ratio is strong at 7.70, suggesting efficient cash conversion from net income. However, free cash flow to net income ratio is negative, highlighting challenges in maintaining positive free cash flow.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.43B	3.37B	3.28B	2.74B	2.07B	1.78B
	Gross Profit
1.12B	1.03B	1.22B	1.06B	688.50M	464.10M
	EBIT
568.00M	549.00M	663.00M	558.90M	379.90M	202.80M
	EBITDA
1.28B	1.36B	1.43B	1.19B	865.40M	654.60M
	Net Income Common Stockholders
128.00M	211.00M	347.00M	330.00M	224.00M	73.70M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
48.00M	83.00M	71.00M	53.50M	35.10M	33.00M
	Total Assets
7.71B	7.88B	7.06B	5.96B	4.49B	3.59B
	Total Debt
5.05B	5.07B	4.48B	3.62B	2.47B	2.05B
	Net Debt
5.00B	4.99B	4.41B	3.56B	2.43B	2.02B
	Total Liabilities
6.35B	6.48B	5.79B	4.85B	3.51B	2.85B
	Stockholders Equity
1.36B	1.40B	1.27B	1.11B	976.90M	742.00M
Cash Flow		Free Cash Flow
-62.00M	16.00M	-390.00M	-355.50M	102.20M	225.40M
	Operating Cash Flow
1.16B	1.23B	1.09B	916.70M	744.00M	610.90M
	Investing Cash Flow
-1.35B	-1.51B	-1.58B	-1.68B	-961.30M	-207.50M
	Financing Cash Flow
178.00M	299.00M	512.00M	784.10M	219.60M	-406.00M

Herc Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 113.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HRI, the sentiment is Negative. The current price of 113.9 is below the 20-day moving average (MA) of 124.47, below the 50-day MA of 120.10, and below the 200-day MA of 163.22, indicating a bearish trend. The MACD of -1.57 indicates Positive momentum. The RSI at 39.47 is Neutral, neither overbought nor oversold. The STOCH value of 40.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HRI.

Herc Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MGRC	79 Outperform	$2.80B	11.79	22.80%	1.70%	7.31%	91.99%
WLFC	69 Neutral	$983.05M	9.75	18.32%	0.70%	32.55%	70.32%
HRI	66 Neutral	$3.78B	25.39	9.60%	2.46%	8.34%	-63.02%
Sector *	66 Neutral	$4.47B	12.22	5.40%	3.65%	4.14%	-12.00%
ALTG	61 Neutral	$207.11M	―	-73.72%	3.65%	-2.09%	-977.36%
WSC	59 Neutral	$4.87B	296.45	1.28%	1.05%	-0.77%	-94.12%
HEES	56 Neutral	$3.47B	38.00	15.74%	1.16%	-3.52%	-46.60%

Herc Holdings Corporate Events

Herc Holdings Completes Acquisition of H&E Equipment

On June 2, 2025, Herc Holdings Inc. completed its acquisition of H&E Equipment Services, significantly enhancing its position in the North American equipment rental market. The acquisition, which involved a cash and stock transaction, strengthens Herc’s presence in key rental regions and expands its fleet and service capabilities, promising substantial growth and value creation opportunities. The transaction also led to the issuance of new credit facilities and senior notes to refinance existing debts and support the acquisition.

The most recent analyst rating on (HRI) stock is a Hold with a $155.00 price target. To see the full list of analyst forecasts on Herc Holdings stock, see the HRI Stock Forecast page.

Herc Holdings Grants Retention Awards to COO

On May 15, 2025, Herc Holdings Inc. granted special retention equity awards to its Chief Operating Officer, Aaron D. Birnbaum. The awards, valued at $1 million, were split equally between restricted stock units (RSUs) and performance stock units (PSUs), with specific vesting schedules and performance criteria tied to Average ROIC and REBITDA margin.

The most recent analyst rating on (HRI) stock is a Hold with a $155.00 price target. To see the full list of analyst forecasts on Herc Holdings stock, see the HRI Stock Forecast page.

Herc Holdings Announces Private Offering for Acquisition

On May 15, 2025, Herc Holdings Inc. announced a private offering of senior unsecured notes to finance its proposed acquisition of H&E Equipment Services, Inc. The offering includes $1,650 million of notes due 2030 and $1,100 million of notes due 2033, with proceeds to be used for the acquisition, redemption of H&E’s existing debt, and related expenses. If the offering does not close concurrently with the acquisition, proceeds will be held in escrow until conditions are met. Upon acquisition closure, the notes will be guaranteed by Herc’s subsidiaries, including H&E’s, enhancing Herc’s market position and financial strategy.

The most recent analyst rating on (HRI) stock is a Hold with a $155.00 price target. To see the full list of analyst forecasts on Herc Holdings stock, see the HRI Stock Forecast page.

Herc Holdings Announces Acquisition of H&E Equipment

On February 19, 2025, Herc Holdings Inc. announced a definitive agreement to acquire H&E Equipment Services, Inc. for $4.8 billion. This acquisition is expected to enhance Herc’s national scale, geographic diversification, and synergy opportunities, potentially accelerating its growth plans. The transaction will be financed through a mix of equity, an upsized revolving credit facility, a new term loan, and unsecured debt. The combined entity will have over 600 branches and a fleet valued at $10 billion, positioning Herc as a more significant player in the industry.

The most recent analyst rating on (HRI) stock is a Hold with a $155.0000 price target. To see the full list of analyst forecasts on Herc Holdings stock, see the HRI Stock Forecast page.