Herc (NYSE:HRI) Posts Quarterly Earnings Results, Beats Estimates By $0.67 EPS

Herc (NYSE:HRI) released its quarterly earnings data on Tuesday. The transportation company reported $1.43 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.76 by $0.67, FiscalAI reports. Herc had a positive return on equity of 10.72% and a negative net margin of 0.11%.The company had revenue of $1.20 billion for the quarter, compared to analyst estimates of $1.16 billion. During the same period in the previous year, the company posted $1.87 EPS. The firm’s revenue for the quarter was up 20.2% compared to the same quarter last year.

Here are the key takeaways from Herc’s conference call:

• Pro forma equipment rental revenue returned to growth, rising 2% year over year in Q2 despite average fleet OEC declining approximately 3%; dollar utilization improved by more than 200 basis points.
• Management raised full-year guidance, targeting approximately $4.425 billion of equipment rental revenue and $2.09 billion of adjusted EBITDA at the midpoints, supported by stronger national-account and mega-project demand.
• The company increased its 2026 net fleet CapEx outlook to roughly $900 million, with about 70% of purchases expected in Q2 and Q3 and the majority weighted toward specialty equipment tied to identified demand.
• Fuel and transportation inflation rose approximately 35% from Q1 and reduced Q2 adjusted EBITDA margin by about 150 basis points; management expects roughly one percentage point of full-year margin pressure and has lowered free-cash-flow guidance to $250 million-$350 million.
• Herc raised its long-term target share of the U.S. mega-project rental opportunity to 15%-20%, but said reaching the upper end will take several years as projects typically generate revenue over three to five years or longer.

Herc Price Performance

Shares of NYSE:HRI opened at $161.65 on Tuesday. The stock has a market cap of $5.40 billion, a PE ratio of -589.96, a PEG ratio of 29.52 and a beta of 1.88. The company’s fifty day moving average is $143.34 and its 200 day moving average is $137.10. Herc has a 52 week low of $88.45 and a 52 week high of $188.35. The company has a quick ratio of 1.46, a current ratio of 1.46 and a debt-to-equity ratio of 4.24.

Herc Dividend Announcement

The firm also recently announced a quarterly dividend, which was paid on Friday, June 12th. Investors of record on Friday, May 29th were issued a dividend of $0.70 per share. The ex-dividend date of this dividend was Friday, May 29th. This represents a $2.80 annualized dividend and a dividend yield of 1.7%. Herc’s dividend payout ratio (DPR) is currently -1,037.04%.

Institutional Investors Weigh In On Herc

Several institutional investors have recently bought and sold shares of HRI. Freestone Grove Partners LP grew its holdings in Herc by 667.9% in the 4th quarter. Freestone Grove Partners LP now owns 573,149 shares of the transportation company’s stock worth $85,044,000 after acquiring an additional 498,511 shares during the last quarter. Invesco Ltd. increased its stake in shares of Herc by 11.2% during the third quarter. Invesco Ltd. now owns 4,123,437 shares of the transportation company’s stock valued at $481,040,000 after buying an additional 413,719 shares during the period. Goldman Sachs Group Inc. raised its holdings in shares of Herc by 305.6% during the fourth quarter. Goldman Sachs Group Inc. now owns 425,582 shares of the transportation company’s stock valued at $63,148,000 after acquiring an additional 320,649 shares in the last quarter. Marshall Wace LLP raised its holdings in shares of Herc by 233.1% during the third quarter. Marshall Wace LLP now owns 420,512 shares of the transportation company’s stock valued at $49,057,000 after acquiring an additional 294,265 shares in the last quarter. Finally, Ameriprise Financial Inc. boosted its holdings in Herc by 3,306.3% in the third quarter. Ameriprise Financial Inc. now owns 292,328 shares of the transportation company’s stock valued at $34,106,000 after acquiring an additional 283,746 shares in the last quarter. 93.11% of the stock is currently owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

HRI has been the topic of a number of recent analyst reports. Citigroup increased their price target on shares of Herc from $155.00 to $175.00 and gave the stock a “buy” rating in a report on Tuesday, July 14th. Weiss Ratings raised shares of Herc from a “sell (d)” rating to a “sell (d+)” rating in a research note on Friday, July 10th. BNP Paribas Exane began coverage on shares of Herc in a report on Monday, June 29th. They set a “neutral” rating and a $160.00 target price on the stock. Zacks Research upgraded shares of Herc from a “strong sell” rating to a “hold” rating in a research note on Tuesday, June 9th. Finally, JPMorgan Chase & Co. raised their price target on shares of Herc from $140.00 to $165.00 and gave the company a “neutral” rating in a report on Monday, July 13th. Five analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the company’s stock. According to data from MarketBeat.com, Herc has an average rating of “Hold” and an average price target of $173.43.

Herc Company Profile

Herc Holdings Inc (NYSE: HRI) operates as a leading equipment rental provider in North America, offering a wide range of machinery and support services to construction, industrial, government and event sectors. The company’s fleet includes aerial work platforms, earthmoving equipment, material handling solutions, power generation units and specialty tools, enabling clients to scale their operations without the capital expense of ownership. In addition to basic machinery rentals, Herc provides value-added services such as equipment maintenance, on-site safety training and project consulting to help customers optimize productivity and maintain compliance with industry standards.

Founded as part of Hertz Global Holdings, the equipment rental business was spun off as an independent public company in early 2016.