United Rentals (URI) Stock Forecast & Price Target

United Rentals commands a robust 16% market share within a growing equipment rental sector, which has seen increased rental penetration in North America from approximately 40% in 2003 to 55-60% in 2022. The company's recent acquisitions of GFN and Yak have positioned it favorably to achieve its targets, bolstering its strategy to serve as a comprehensive one-stop shop for customers. Additionally, a $300 million increase in rental equipment capital expenditure guidance for 2025, alongside strong year-over-year growth in nonresidential demand, underscores the company's favorable market position and sets it up for continued success moving into 2026.

United Rentals reported Q3 revenue of $4,229 million, which reflects a 5.9% year-over-year increase but fell short in delivering adjusted EPS of $11.70, below consensus estimates of $12.11 and $12.29. Notably, the company's adjusted EBITDA margin of 46.0% matched expectations, yet the overall performance was hindered by lower gross margins in equipment rentals, attributed to the normalization of the used equipment market and pricing dynamics. The outlook remains negative as risks include a potential slowdown in nonresidential construction activity and industrial demand, compounded by challenges in managing fixed costs and integrating additional acquisitions.