Size Matters - AHT to double its market share to 20% in highly fragmented US equipment rental market. The two market leaders (United Rentals and AHT) can consolidate their collective share toward 50% over the next 10 years. 2Xideas expect a revenue CAGR from FY21 to FY27E of 10.4% (8% organic) and net profit growth of 14.8% p.a. Margin expansion will result from productivity gains, operating leverage and a higher contribution from its Specialty segment. RoAIC to rise from 9.8% to 13.6%. Annualised total return of 12.6%.
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The Cut
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Company Research
Extremely bullish set up for rates and equipment rental stocks
Report by Thompson Research Group
No let up in demand, undersupply to last well into 2022 - the situation appears even more acute and prolonged than TRG had originally anticipated. One of their equipment rental contacts provided a clear view of the current situation - “there’s not a rental company in our region that has enough equipment”. This early read leads TRG to expect strong Q2 results and raised FY21 guidance/outlook from United Rentals, Herc Holdings, H&E Equipment Services and WillScot Mobile Mini Holdings.