United Rentals Stock Down on Q4 Earnings Miss, Revenue Beat

Core Viewpoint - United Rentals, Inc. (URI) reported mixed fourth-quarter 2024 results, with earnings per share (EPS) missing estimates while revenues exceeded expectations, both showing year-over-year improvement [1][4]. Financial Performance - Adjusted EPS for the fourth quarter was $11.59, missing the Zacks Consensus Estimate of $11.77 by 1.5%, but increased 2.9% from the prior year's adjusted figure of $11.26 [4]. - Total revenues reached $4.095 billion, surpassing the consensus mark of $3.942 billion by 3.9%, and grew 9.8% year-over-year [4]. - For the full year, total revenues were $15.345 billion, up 7.1%, and adjusted earnings were $43.17 per share, reflecting a 6% increase from 2023 [11]. Segment Performance - Equipment Rentals revenues increased 9.7% year-over-year to $3.422 billion, marking a record high for the fourth quarter [5]. - General Rentals segment saw a 2.2% year-over-year growth in rental revenues to $2.339 billion, with rental gross margin contracting 170 basis points to 37.4% [7]. - Specialty segment rental revenues improved 30.5% year-over-year to $1.083 billion, with a gross margin contraction of 170 basis points to 45.5% [8]. Margins and EBITDA - Total equipment rentals' gross margin contracted 130 basis points year-over-year to 40% [9]. - Adjusted EBITDA for the reported period grew 5% year-over-year to $1.9 billion, with an adjusted EBITDA margin contracting 210 basis points to 46.4% [9]. Cash Flow and Shareholder Returns - Net cash from operating activities decreased 3.4% year-over-year to $4.546 billion, while free cash flow fell 10.8% to $2.065 billion [13]. - The company returned $1.934 billion to shareholders in 2024, including $1.5 billion through share repurchases and $434 million in dividends [13]. - A 10% increase in the quarterly dividend was approved, with a declared dividend of $1.79 per share [13]. 2025 Guidance - Total revenues for 2025 are expected to be in the range of $15.1-$15.3 billion, with adjusted EBITDA anticipated between $7.115 billion and $7.215 billion [14]. - Net rental capital expenditure is projected to be between $2.2-$2.5 billion [14].