The 10-second takeaway
For the quarter ended Dec. 31 (Q4), United Rentals met expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share stayed the same.
Gross margins grew, operating margins increased, net margins dropped.
United Rentals tallied revenue of $1.25 billion. The eight analysts polled by S&P Capital IQ expected to see a top line of $1.26 billion on the same basis. GAAP reported sales were 67% higher than the prior-year quarter's $746.0 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.27. The 10 earnings estimates compiled by S&P Capital IQ averaged $1.01 per share. GAAP EPS of $0.39 were the same as the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.6%, 270 basis points better than the prior-year quarter. Operating margin was 20.4%, 60 basis points better than the prior-year quarter. Net margin was 3.3%, 60 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.11 billion. On the bottom line, the average EPS estimate is $0.48.
Next year's average estimate for revenue is $5.10 billion. The average EPS estimate is $4.74.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 204 members out of 224 rating the stock outperform, and 20 members rating it underperform. Among 76 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 72 give United Rentals a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on United Rentals is outperform, with an average price target of $49.42.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.