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Sunbelt Rentals Holdings Inc
(NYSE:SUNB)
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Rating:67Neutral
Price Target:
$82.00
▲(14.54% Upside)
Action:N/A
Date:06/24/26
The score is driven primarily by solid underlying financial performance (profitability/ROE and generally healthy cash conversion) and a positive earnings-call outlook with supportive FY2027 guidance and manageable leverage. These strengths are tempered by weaker technical setup (trading below key moving averages with subdued RSI) and a valuation that is not notably cheap on a ~24x P/E, with no dividend yield data to provide additional support.
Positive Factors
Strong free cash flow generation
Consistent ability to generate meaningful free cash flow (record $2.1B) supports durable capital allocation: funds organic growth, specialty greenfields, bolt-on M&A, and shareholder returns without heavy reliance on new external financing, improving strategic optionality over time.
Negative Factors
Margin compression from mix shift
A structural shift toward specialty and ancillary lines, which carry lower EBITDA margins, combined with early-stage mega-project load-ins, is compressing margins. If mix persists, long-term profitability and return-on-capital could be meaningfully lower despite revenue growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow generation
Consistent ability to generate meaningful free cash flow (record $2.1B) supports durable capital allocation: funds organic growth, specialty greenfields, bolt-on M&A, and shareholder returns without heavy reliance on new external financing, improving strategic optionality over time.
Read all positive factors
Sunbelt Rentals Holdings Inc (SUNB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$29.91B
Dividend YieldN/A
Average Volume (3M)N/A
Price to Earnings (P/E)24.1
Beta (1Y)1.17
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees25,428
SectorGeneral
Sector StrengthN/A
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)3.12
Shares Outstanding409,760,600
10 Day Avg. VolumeN/A
30 Day Avg. VolumeN/A
Financial Highlights & Ratios
PEG Ratio-1.80
Price to Book (P/B)4.31
Price to Sales (P/S)2.86
P/FCF Ratio9.31
Enterprise Value/Market Cap1.47
Enterprise Value/Revenue3.93
Enterprise Value/Gross Profit6.36
Enterprise Value/Ebitda10.44
Forecast
1Y Price Target
$80.99Price Target Upside13.12% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)4.05
Revenue Forecast (FY)$11.75B
Sunbelt Rentals Holdings Inc Business Overview & Revenue Model
Company Description
Sunbelt Rentals Holdings Inc. operates as a prominent equipment leasing firm, furnishing an extensive array of tools, various machinery, and customized engineering solutions. Its clientele spans diverse sectors including construction, industrial a...
How the Company Makes Money
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Sunbelt Rentals Holdings Inc Earnings Call Summary
Earnings Call Date:Jun 23, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Sep 08, 2026
Earnings Call Sentiment Positive
The call highlights strong top-line momentum (record Q4 and FY revenue), exceptional free cash flow generation, disciplined capital allocation, an expanded specialty footprint (including a strategic acquisition), a materially strengthened mega-project pipeline, and constructive FY2027 guidance. Near-term challenges center on margin compression driven by mix shifts toward specialty and ancillary revenues, lapping a one-time prior-year receivable reversal, fleet repositioning costs, and a Q4 CapEx ramp tied to mega-project work. Management expects margins to improve in the back half of FY2027 as utilization and operational initiatives take hold. Overall, the positive operational and financial momentum, strong cash generation, healthy balance sheet, and clear pathway for converting growth to returns outweigh the transitory margin pressures.Positive Updates
Record Revenue and Rental Growth
Q4 revenue of $2.8B (+8.9% YoY) and FY2026 revenue of $11.2B (+3.4% YoY). Full-year equipment rental revenue $10.3B (+3.4% YoY) with strong Q4 rental revenue growth of ~8%.
Negative Updates
Adjusted EBITDA Decline and Margin Compression
Adjusted EBITDA declined ~2% YoY to $4.7B and full-year adjusted EBITDA margin compressed ~200 bps to 41.9%. Excluding a prior-year $28M receivable reversal, Q4 adjusted EBITDA margin declined ~290 bps.
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Q4-2026 Updates
Positive
Negative
Record Revenue and Rental Growth
Q4 revenue of $2.8B (+8.9% YoY) and FY2026 revenue of $11.2B (+3.4% YoY). Full-year equipment rental revenue $10.3B (+3.4% YoY) with strong Q4 rental revenue growth of ~8%.
Read all positive updates
Company Guidance
Sunbelt guided fiscal 2027 to total revenue growth of 4.5%–7.5% and rental revenue growth of 5%–8%, with adjusted EBITDA of $4.85–$5.05 billion (margins “broadly flat” year‑over‑year but expected to improve in the back half), net rental equipment CapEx of $2.05–$2.45 billion (gross rental CapEx $2.45–$2.85 billion), and plans to open 55 greenfields (15 general tool, 40 specialty); the Reliant (Aries) acquisition is expected to contribute just under 1% to the guide, mega projects are assumed to remain an important demand driver while local non‑residential construction is assumed stable, capital allocation will prioritize organic investment and disciplined bolt‑on M&A before buybacks/dividends, the firm will transition to a quarterly dividend (Q1 amount/timing to be announced), and management expects to remain within its 1.0–2.0x net debt/EBITDA leverage target (Net debt/EBITDA was 1.6x at year‑end).Sunbelt Rentals Holdings Inc Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
70
Positive
| Breakdown | Apr 2026 | Apr 2025 | Apr 2024 | Apr 2023 | Apr 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 11.15B | 10.79B | 10.86B | 9.67B | 7.96B |
| Gross Profit | 4.29B | 9.50B | 9.65B | 8.56B | 7.02B |
| EBITDA | 4.50B | 5.00B | 4.89B | 4.41B | 3.56B |
| Net Income | 1.32B | 1.51B | 1.60B | 1.62B | 1.25B |
Balance Sheet | |||||
| Total Assets | 22.27B | 21.69B | 21.65B | 18.73B | 15.29B |
| Cash, Cash Equivalents and Short-Term Investments | 29.00M | 21.00M | 20.80M | 29.90M | 15.30M |
| Total Debt | 10.16B | 10.35B | 10.68B | 8.99B | 7.18B |
| Total Liabilities | 14.86B | 14.02B | 14.57B | 12.72B | 10.26B |
| Stockholders Equity | 7.41B | 7.67B | 7.08B | 6.01B | 5.03B |
Cash Flow | |||||
| Free Cash Flow | 3.43B | 1.72B | 169.00M | 490.10M | 1.10B |
| Operating Cash Flow | 3.78B | 2.17B | 854.60M | 1.00B | 1.50B |
| Investing Cash Flow | -1.93B | -541.80M | -1.53B | -1.59B | -1.69B |
| Financing Cash Flow | -1.85B | -1.63B | 663.20M | 609.30M | 181.50M |
Sunbelt Rentals Holdings Inc Peers Comparison
UnderperformOutperform
Sector (55)
SUNB
Sunbelt Rentals Holdings Inc
74.84
1.81
2.48%
IX
Orix
40.30
17.62
77.69%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.