If You Invested $1000 in United Rentals a Decade Ago, This is How Much It'd Be Worth Now
How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in United Rentals (URI) ten years ago? It may not have been easy to hold on to URI for all that time, but if you did, how much would your investment be worth today?
United Rentals' Business In-Depth
With that in mind, let's take a look at United Rentals' main business drivers.
Headquartered in Stamford, CT, United Rentals, Inc. is the largest equipment rental company in the world, with an integrated network of 1,521 rental locations in United States, Canada and Europe. Moreover, it operates in 49 states and every Canadian province. The company offers 4,600 classes of equipment for rent at a total original equipment cost (“OEC”) of $19.6 billion (as of December 2022).
The company’s customer base includes construction and industrial companies, utilities, municipalities, government agencies, independent contractors and homeowners and other individuals that use equipment for projects that range from simple repairs to major renovations. The company’s principal products and services are equipment rental, sale of rental equipment, new equipment, contractor supplies, services and other.
United Rentals serves customers as a single-source solution, provided through two business segments: General Rentals and Specialty or Trench, Power and Fluid Solutions.
General Rentals (accounted for 73.7% of total revenues in 2022) includes the rental of construction, aerial and industrial equipment, general tools and light equipment, along with related services and activities. The segment includes the rental of the following: i) general construction and industrial equipment ii) aerial work platforms and iii) general tools and light equipment. The general rentals segment is comprised of four geographic divisions - Central, Northeast, Southeast and West - and operates throughout the United States and Canada.
Specialty (26.3%) includes the rental of specialty construction products and related services like trench safety equipment, power and HVAC equipment, and fluid solutions equipment.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For United Rentals, if you bought shares a decade ago, you're likely feeling really good about your investment today.
According to our calculations, a $1000 investment made in February 2013 would be worth $8,476.55, or a 747.65% gain, as of February 10, 2023. Investors should keep in mind that this return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 168.89% and the price of gold went up 7.09% over the same time frame.
Analysts are forecasting more upside for URI too.
United Rentals’ fourth-quarter 2022 earnings and revenues missed the Zacks Consensus Estimate but grew year over year given sustained demand in its end markets and the strength of its core rental business. Earnings and revenues grew 31.8% and 18.7%, respectively, driven by higher rental revenues (up 18.8%), fleet productivity (up 5.9%) and absorptions, owing to the broad-based recovery of activity across end markets served by URI. Adjusted EBITDA margin expanded 280 basis points (bps), owing to higher margins from rental revenues. Even its new 2023 guidance exhibits broad-based growth across its verticals, with consistent growth opportunities for datacenters, distribution centers and renewables as well as the automotive and ship plants projects. Shares of United Rentals have outperformed the industry over the past six months.
Over the past four weeks, shares have rallied 14.87%, and there have been 7 higher earnings estimate revisions in the past two months for fiscal 2023 compared to none lower. The consensus estimate has moved up as well.
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United Rentals, Inc. (URI) : Free Stock Analysis Report
