United Rentals (NYSE:URI) Shares Gap Up Following Better-Than-Expected Earnings

United Rentals, Inc. (NYSE:URI)’s share price gapped up prior to trading on Thursday following a better than expected earnings announcement. The stock had previously closed at $655.19, but opened at $680.00. United Rentals shares last traded at $668.57, with a volume of 339,574 shares traded.

The construction company reported $9.15 earnings per share for the quarter, beating the consensus estimate of $8.35 by $0.80. The company had revenue of $3.49 billion during the quarter, compared to the consensus estimate of $3.44 billion. United Rentals had a return on equity of 36.85% and a net margin of 17.31%. United Rentals’s revenue was up 6.1% compared to the same quarter last year. During the same period in the previous year, the company posted $7.95 EPS.

United Rentals Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Wednesday, May 22nd. Shareholders of record on Wednesday, May 8th will be given a $1.63 dividend. This represents a $6.52 annualized dividend and a yield of 0.94%. The ex-dividend date is Tuesday, May 7th. United Rentals’s dividend payout ratio is currently 17.66%.

United Rentals declared that its Board of Directors has approved a share buyback program on Wednesday, January 24th that authorizes the company to buyback $1.50 billion in shares. This buyback authorization authorizes the construction company to purchase up to 3.8% of its shares through open market purchases. Shares buyback programs are typically an indication that the company’s board believes its stock is undervalued.

Analyst Ratings Changes

A number of brokerages have recently commented on URI. BNP Paribas reissued an “underperform” rating and set a $485.00 price objective on shares of United Rentals in a research report on Friday, January 5th. The Goldman Sachs Group boosted their price objective on United Rentals from $718.00 to $790.00 and gave the stock a “buy” rating in a research report on Tuesday, April 16th. Truist Financial began coverage on United Rentals in a research report on Thursday, March 14th. They set a “buy” rating and a $793.00 price objective for the company. Morgan Stanley began coverage on United Rentals in a research report on Monday, January 8th. They set an “equal weight” rating and a $500.00 price objective for the company. Finally, Robert W. Baird boosted their price objective on United Rentals from $322.00 to $559.00 and gave the stock an “underperform” rating in a research report on Friday, January 26th. Three analysts have rated the stock with a sell rating, four have assigned a hold rating and six have assigned a buy rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Hold” and a consensus target price of $600.57.

Insider Buying and Selling

In related news, CFO William E. Grace sold 775 shares of the business’s stock in a transaction that occurred on Thursday, February 15th. The stock was sold at an average price of $655.62, for a total transaction of $508,105.50. Following the completion of the sale, the chief financial officer now owns 6,323 shares in the company, valued at $4,145,485.26. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. 0.53% of the stock is owned by company insiders.

Institutional Investors Weigh In On United Rentals

Institutional investors have recently added to or reduced their stakes in the business. Capital Research Global Investors lifted its stake in United Rentals by 39.1% in the fourth quarter. Capital Research Global Investors now owns 6,399,808 shares of the construction company’s stock valued at $3,669,806,000 after buying an additional 1,799,997 shares during the last quarter. Norges Bank purchased a new stake in United Rentals in the fourth quarter valued at approximately $977,443,000. Dimensional Fund Advisors LP lifted its stake in United Rentals by 4.8% in the fourth quarter. Dimensional Fund Advisors LP now owns 1,246,092 shares of the construction company’s stock valued at $714,578,000 after buying an additional 56,948 shares during the last quarter. International Assets Investment Management LLC lifted its stake in United Rentals by 58,829.4% in the fourth quarter. International Assets Investment Management LLC now owns 1,043,051 shares of the construction company’s stock valued at $598,106,000 after buying an additional 1,041,281 shares during the last quarter. Finally, Invesco Ltd. lifted its stake in United Rentals by 19.1% in the third quarter. Invesco Ltd. now owns 933,428 shares of the construction company’s stock valued at $414,974,000 after buying an additional 149,838 shares during the last quarter. Hedge funds and other institutional investors own 96.26% of the company’s stock.

United Rentals Stock Performance

The company has a debt-to-equity ratio of 1.24, a current ratio of 0.81 and a quick ratio of 0.75. The stock has a 50 day simple moving average of $681.18 and a two-hundred day simple moving average of $578.63. The company has a market cap of $46.40 billion, a PE ratio of 18.71, a PEG ratio of 2.27 and a beta of 1.84.

United Rentals Company Profile

United Rentals, Inc, through its subsidiaries, operates as an equipment rental company. It operates in two segments, General Rentals and Specialty. The General Rentals segment rents general construction and industrial equipment includes backhoes, skid-steer loaders, forklifts, earthmoving equipment, and material handling equipment; aerial work platforms, such as boom and scissor lifts; and general tools and light equipment comprising pressure washers, water pumps, and power tools for construction and industrial companies, manufacturers, utilities, municipalities, homeowners, and government entities.