United Rentals Shares Decline

In early trading on Tuesday, shares of United Rentals (NYSE:URI) experienced a 5% decline following an announcement from its UK counterpart Ashtead (LON:AHT) that it had lowered its full-year rental revenue growth projection in the U.S. market. Ashtead, which operates in a similar sector, revised its expected growth down to 2-4%, a decrease from the previously anticipated 4-7%.

The revision by Ashtead also included a less optimistic profit outlook, highlighting the difficulties facing the construction and equipment rental industries as they navigate a patchy recovery.

Despite the initial market reaction, analysts at Evercore ISI expressed support for United Rentals. They noted that United Rentals management had spoken with both Evercore ISI and Ashtead, and they did not express surprise at Ashtead's comments. According to the analyst, the update from Ashtead aligns with United Rentals' own expectations and guidance, indicating that there were "no surprises" for United Rentals.

Ashtead's stock, which is currently traded in Europe, saw a significant drop of approximately 13%. The company also mentioned its intention to transition to a primary stock listing in the U.S. within the next 12 to 18 months.

Evercore ISI maintains a positive outlook on United Rentals, ranking it among their top five preferred stocks. Their investment perspective favors selective U.S. sectors over international ones, with a preference for U.S. trucking and short-cycle industries over agriculture and construction machinery.

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