The biggest equipment rental company, United Rentals (URI), on Wednesday beat estimates for earnings and revenue estimates for the third quarter, but after-hours trading saw the stock get battered.
United Rentals revenue jumped 18.4% to $2.11 billion for the quarter, earning $4.01 per diluted share. According to estimates, earnings was forecast to jump 48% to $3.50 per share, while revenue moves 13% higher to $1.8 billion from a year ago.
Earlier today, trading closed at $155.64, up 2.1%. But stock fell sharply 2.6% after results announcement. Rivals Caterpiller (CAT) and John Deere (DE) inched 1.6% and 0.9% higher respectively.
OUTLOOK: Setting aside the impact of the BlueLine takeover, United Rentals lifted its FY 2018 target midpoint to $7.6 billion from $7.45 billion.
Over the past five quarters – including this third quarter, United has missed estimates only once.
At the end of July, United completed its acquisition of BakerCorp for around $715 million and updated its guidance to reflect the transaction. Total revenue is now expected to range between $7.6 billion and $7.8 billion while adjusted EBITDA is expected to range between $3.71 billion and $3.81 billion.
In early September, United Rentals had announced that it would buy BlueLine from Platinum Equity for about $2.1 billion in cash., with the transaction expected to close by the fourth quarter.
BlueLine is one of the ten largest equipment rental companies in North America, which generated an estimated $313 million of adjusted EBITDA at a 39.8% margin on $786 million of total revenue for the trailing 12 months ended August 31, 2018.
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