Service-Sector Earnings to Watch This Week

URI data by YCharts

United Rentals (URI)

Background: United Rentals, through its subsidiaries, operates as an equipment rental company. It offers approximately 3,000 classes of equipment for rent to customers comprising construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. The company was founded in 1997 and is headquartered in Greenwich, Conn. United Rentals trades an average of 3.3 million shares per day and has a market cap of $3 billion.

52-Week Range: $19.76 to $47.98

Book Value: $15.43

Price-to-Book: 2.1

Strong third-quarter earnings growth is expected by Wall Street after the market closes on Tuesday. The consensus EPS mean is $1.12 a share, a gain of 20 cents, or 18%, from 92 cents during the corresponding quarter last year. The lowest analyst estimate is $1.01, and the highest is $1.25 per share. If earnings come in as expected or higher, this quarter will not only beat the same period last year, but also last quarter.

Analysts like this company. Out of the 14 analysts covering United Rentals, 12 rate it a buy, two rate it a hold and no analysts rate it a sell. The stock appreciated 69% in the last year, and the average analyst target price for United Rentals is $45.92.

In April the stock peaked, and it's now trading within a range of $28 to about $37. The 200-day moving average is climbing, but in the shorter term, the chart is bearish.

Shares are now trading beneath all the major moving averages, and a break below $30 a share appears probable.

Adding insult to injury, the short interest is markedly elevated and should be treated as warning that short-sellers anticipate continued price weakness. The current float short is 16.3%. URI Revenue Quarterly data by YCharts

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