United Rentals (URI) AI Stock Analysis

• Market Cap: $43.25B
• Dividend Yield: 1%
• Average Volume (3M): 789.96K
• Price to Earnings (P/E): 17.2
• Beta (1Y): 1.72
• Revenue Growth: 7.20%
• EPS Growth: 4.56%
• Country: US
• Employees: 27,900
• Sector: Industrials
• Sector Strength: 78
• Industry: Rental & Leasing Services
• EPS (TTM): 38.62
• Shares Outstanding: 64,999,040
• 10 Day Avg. Volume: 774,791
• 30 Day Avg. Volume: 789,957
• PEG Ratio: 3.78
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.26
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 8.86
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $715.67
• Price Target Upside: 7.55% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

United Rentals demonstrates strong financial performance with efficient operations and robust profitability metrics. The positive earnings call highlights significant growth and strong cash flow, reinforcing the company's solid market position. While high debt levels and some technical bearish trends are concerns, the overall outlook remains favorable with a fair valuation and strategic focus on shareholder value.

Positive Factors

Financial Performance

URI reported a solid Q1 EBITDA of $1.67bn, up 5% YoY, and reaffirmed its FY guide.

Shareholder Returns

URI introduced a new $1.5bn repurchase program after completing its prior program.

Negative Factors

Market Conditions

A softer supply/demand environment will pressure GenRent gross margins, making it difficult to pass on fleet inflation costs to customers.

Profitability Pressure

GenRent will be an overhang in 2025, with fleet growth and productivity being pressured.

United Rentals Business Overview & Revenue Model

Company Description

United Rentals, Inc. (URI) is the largest equipment rental company in the world, operating in the industrial and construction sectors. The company offers a comprehensive range of equipment for rent, including aerial work platforms, earthmoving equipment, forklifts, and general tools, serving a diverse customer base from construction and industrial companies to utilities and government agencies. United Rentals also provides related services, such as safety training and 24/7 equipment service and support, ensuring that customers have the equipment and expertise needed to complete their projects efficiently.

How the Company Makes Money

United Rentals makes money primarily through the rental of equipment to various industries, including construction, industrial, and commercial sectors. The company's revenue model is based on leasing equipment to customers for short-term and long-term projects, which generates a steady income stream. Additionally, United Rentals sells new and used equipment, adding another revenue stream to its business model. The company also offers value-added services such as equipment repair, maintenance, and safety training, which contribute to its earnings. Strategic partnerships with equipment manufacturers and continuous expansion into new markets further enhance United Rentals' revenue potential.

United Rentals Financial Statement Overview

Summary

United Rentals exhibits strong financial performance with robust profitability metrics, efficient operations, and effective cash flow management. While the company shows healthy growth and a stable capital structure, the relatively high debt levels and decline in free cash flow growth are areas to watch.

Income Statement

United Rentals demonstrates a strong income statement with robust gross and net profit margins, indicating efficient operations and solid profitability. The TTM (Trailing-Twelve-Months) gross profit margin is 38.84%, and the net profit margin is 16.37%, both suggesting a well-managed cost structure. The revenue growth rate from 2024 to TTM is moderate at 1.53%, showing consistent expansion, although slightly lower than previous years. The EBIT margin of 25.79% and EBITDA margin of 37.10% also reflect strong operational efficiency. Overall, the income statement shows solid profitability with stable growth trends.

Balance Sheet

The balance sheet presents a solid equity base with a moderate equity ratio of 31.33% TTM, indicating a stable capital structure. The debt-to-equity ratio is relatively high at 1.59, suggesting the company is leveraging debt to fuel its operations, which could pose risks if market conditions change. Return on Equity (ROE) is strong at 29.02%, reflecting efficient use of equity capital to generate profits. Overall, the balance sheet points to a well-capitalized company, albeit with a notable reliance on debt.

Cash Flow

United Rentals exhibits strong cash flow management, with a healthy operating cash flow to net income ratio of 1.94 TTM, demonstrating robust cash generation from operations. The free cash flow to net income ratio is 0.54, indicating effective capital expenditure management. However, the free cash flow growth rate shows a decline of 66.97% from 2024 to TTM, which warrants monitoring. Despite this decline, the company maintains a solid cash position and effective cash utilization strategies.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
15.35B	14.33B	11.64B	9.72B	8.53B
	Gross Profit
6.15B	5.81B	5.00B	3.85B	3.18B
	EBIT
4.07B	3.83B	3.23B	2.28B	1.80B
	EBITDA
6.98B	6.63B	5.46B	2.64B	2.19B
	Net Income Common Stockholders
2.58B	2.42B	2.10B	1.39B	890.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
457.00M	363.00M	106.00M	144.00M	202.00M
	Total Assets
28.16B	25.59B	24.18B	20.29B	17.87B
	Total Debt
14.79B	12.66B	12.01B	10.31B	10.23B
	Net Debt
14.33B	12.30B	11.91B	10.16B	10.03B
	Total Liabilities
19.54B	17.46B	17.12B	14.30B	13.32B
	Stockholders Equity
8.62B	8.13B	7.06B	5.99B	4.54B
Cash Flow		Free Cash Flow
419.00M	634.00M	743.00M	491.00M	1.50B
	Operating Cash Flow
4.55B	4.70B	4.43B	3.69B	2.66B
	Investing Cash Flow
-4.15B	-2.98B	-5.02B	-3.61B	-223.00M
	Financing Cash Flow
-274.00M	-1.47B	552.00M	-140.00M	-2.29B

United Rentals Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 665.40
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For URI, the sentiment is Neutral. The current price of 665.4 is above the 20-day moving average (MA) of 601.72, above the 50-day MA of 616.78, and below the 200-day MA of 727.53, indicating a neutral trend. The MACD of 6.57 indicates Negative momentum. The RSI at 62.15 is Neutral, neither overbought nor oversold. The STOCH value of 84.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for URI.

United Rentals Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
URI	80 Outperform	$43.25B	17.23	30.17%	1.00%	7.20%	4.56%
MGRC	74 Outperform	$2.70B	11.36	22.80%	1.74%	7.31%	91.99%
R	69 Neutral	$5.98B	12.66	16.41%	2.17%	6.21%	47.05%
Sector *	64 Neutral	$4.27B	11.81	5.31%	249.66%	4.08%	-8.61%
HRI	61 Neutral	$3.27B	15.53	9.60%	2.32%	8.34%	-63.02%
HEES	56 Neutral	$3.33B	36.43	15.74%	1.21%	-3.52%	-46.60%
PONY	34 Underperform	$3.64B	―	-33.58%	―	4.27%	-120.11%

United Rentals Corporate Events

United Rentals Announces Q1 2025 Results and Buyback

On April 23, 2025, United Rentals announced its first quarter 2025 financial results, reaffirmed its full-year guidance, and introduced a new $1.5 billion share repurchase program. The company reported a total revenue of $3.719 billion, with a net income of $518 million and an adjusted EBITDA of $1.671 billion. Despite a decrease in net income margin, the company saw a 7.4% increase in rental revenue year-over-year, driven by demand across its end-markets and the impact of the Yak acquisition. United Rentals plans to repurchase $1.25 billion in shares in 2025, reflecting its strategy to capitalize on growth opportunities and differentiate from competitors.

Spark’s Take on URI Stock

According to Spark, TipRanks’ AI Analyst, URI is a Outperform.

United Rentals presents a strong financial foundation with robust revenue growth and efficient operations, though moderate leverage needs monitoring. The technical indicators show some bearish trends, but the fair valuation and positive earnings call offset these concerns. Recent corporate events, including the decision not to pursue an acquisition and focus on shareholder returns, reinforce financial prudence.

To see Spark’s full report on URI stock, click here.

United Rentals Receives Termination Fee After Merger Ends

On February 19, 2025, United Rentals, Inc. and its subsidiary UR Merger Sub VII Corporation withdrew their cash tender offer to purchase H&E Equipment Services, Inc. due to the termination of their merger agreement. As part of the termination, H&E will pay United Rentals a termination fee of over $63 million, and the bridge facility commitment letter associated with the merger has also been terminated.

United Rentals Ends Acquisition Pursuit, Resumes Buybacks

On February 18, 2025, United Rentals announced its decision not to pursue a revised acquisition proposal for H&E Equipment Services, opting instead to allow the merger agreement to be terminated following a superior offer received by H&E. This decision underlines United Rentals’ commitment to financial discipline and its strategy to focus on profitable growth and shareholder value. Subsequently, United Rentals will resume its share repurchase program, which is a key component of its capital return strategy, with $250 million remaining from its authorized $1.5 billion program.

United Rentals to Present at Global Tech Conference

On February 12, 2025, United Rentals announced its participation in Citi’s 2025 Global Industrial Tech and Mobility Conference on February 19, 2025. The company’s CEO Matt Flannery and CFO Ted Grace will present, potentially discussing the company’s business and prospects. This participation highlights United Rentals’ engagement with key industry stakeholders and its active role in the industrial tech and mobility sectors.