A month has gone by since the last earnings report for United Rentals (URI). Shares have lost about 3.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is United Rentals due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.

United Rentals Q2 Earnings Beat on Rental Growth, '26 Guidance Raised

United Rentals reported solid second-quarter 2026 results, with adjusted earnings per share and total revenues beating the Zacks Consensus Estimate and increasing year over year.

Record rental revenues, higher fleet productivity and robust specialty demand supported the results. Fleet productivity improved 3.4% year over year.

URI's Q2 Earnings & Revenues

URI posted adjusted earnings of $12.76 per share, up 21.9% from $10.47 a year ago and surpassing the Zacks Consensus Estimate of $11.67 by 9.3%.

Total revenues advanced 11.8% to $4.41 billion and topped the consensus mark of $4.24 billion by 4.1%.

URI’s Rental Revenues Reach a Quarterly Record

Rental revenues increased 12.7% year over year to a quarterly record of $3.85 billion. Average original equipment at cost, or OEC, rose 7.1%. 

Owned equipment rental revenues increased 9% to $2.99 billion from $2.75 billion. Re-rent revenues rose 46.7% to $88 million, while ancillary and other rental revenues advanced 26.2% to $770 million.

Sales of rental equipment increased 4.1% to $330 million. Sales of new equipment rose 14.7% to $86 million, contractor supplies sales increased 7.3% to $44 million and service and other revenues grew 6.3% to $101 million.

United Rentals Sees Specialty Growth Accelerate

General Rentals segment equipment rental revenues increased 6.6% year over year to $2.42 billion. Equipment rental gross profit rose 8.7% to $865 million, while gross margin expanded 70 basis points to 35.8%.

Specialty segment equipment rental revenues rose 24.8% to $1.43 billion. Gross profit increased 21.1% to $636 million, but gross margin contracted 140 basis points to 44.4%. The decline reflected a revenue mix shift toward lower-margin ancillary and re-rent revenues, partly offset by lower labor and benefit expenses as a percentage of revenues.

United Rentals' Profitability Improves

Gross profit increased to $1.73 billion from $1.53 billion. The gross margin improved to 39.3% from 38.9%, as revenue growth outpaced the increase in cost of revenues.

Adjusted EBITDA rose 13.6% to a quarterly record of $2.06 billion. The adjusted EBITDA margin expanded 70 basis points to 46.6%, including a $49 million gain from the sale of part of the scaffolding business. Excluding that gain, the margin declined 40 basis points due mainly to the Specialty Rentals mix pressure.

Net income increased 21.1% to a second-quarter record of $753 million. Net income margin expanded 130 basis points to 17.1%, including a $37 million after-tax benefit from the scaffolding transaction.

United Rentals Maintains Financial Flexibility

For the first six months of 2026, net cash provided by operating activities increased 20.1% to $3.31 billion. Free cash flow declined 4.1% to $1.15 billion, including restructuring-related payments and gross rental equipment purchases of $2.72 billion.

URI ended June with liquidity of $3 billion, including $112 million in cash and equivalents. Its net leverage ratio improved to 1.8x from 1.9x at the end of 2025.

The company returned $998 million to its shareholders during the first half of 2026, comprising $750 million in share repurchases and $248 million in dividends. United Rentals expects to repurchase $1.5 billion of shares in 2026 and declared a quarterly dividend of $1.97 per share.

URI Raises Key 2026 Guidance Ranges

Management raised its 2026 revenue outlook to $17.5-$17.8 billion from $16.9-$17.4 billion. The adjusted EBITDA forecast increased to $7.98-$8.13 billion from $7.63-$7.88 billion.

United Rentals now expects net cash provided by operating activities of $5.85-$6.65 billion, compared with the prior projection of $5.4-$6.2 billion. The free cash flow outlook, excluding restructuring-related payments, was maintained at $2.15-$2.45 billion.

Net rental capital expenditures are projected at $3.4-$3.8 billion after gross purchases of $4.85-$5.25 billion. Management cited large-project activity, customer backlogs and year-to-date momentum as factors supporting the higher outlook.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in estimates review.

VGM Scores

Currently, United Rentals has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock has a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise United Rentals has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

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United Rentals, Inc. (URI): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research