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United Rentals (URI) Acquires NES Rentals for $965 Million
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Equipment rental company United Rentals, Inc. (URI - Free Report) completed the acquisition of NES Rentals Holdings II, Inc. (“NES”). NES is one of the ten large general equipment rental companies in the U.S., providing specialized aerial equipment to approximately 18,000 customers across the industrial and non-residential construction sectors.
Agreement Details
On Jan 25, United Rentals and Diamond Castle Holdings LLC, the majority owner of NES, entered into an agreement to acquire NES.
The total purchase price is approximately $965 million in cash, funded through a combination of newly issued unsecured debt and available capacity on the company’s ABL facility.
The assets acquired by United Rentals includes $900 million of fleet based on original cost, 73 branch facilities in the eastern half of the U.S. and approximately 1100 employees.
Benefits for United Rentals
The acquisition expands United Rentals’ geographic footprint in important markets like East Coast, Gulf States and Midwest. It is also expected to strengthen relationships with local and strategic accounts in the construction and industrial sectors, thus enhancing cross-selling capabilities.
The acquisition is also expected to leverage United Rentals’ technology and infrastructure. Management believes that the addition of NES will boost its revenues, earnings, EBITDA, free cash flow and overall scale.
Stock Price Movement
United Rentals’ shares have gained around 108.2% in the last one year, compared with the 27.5% increase of the Zacks categorized Building Products - Miscellaneous industry. Going forward, the NES acquisition is expected to significantly boost growth further, driving the stock’s performance in the upcoming quarters as well.
Meanwhile, the company’s current quarter consensus estimate moved 0.6% up while the current year consensus estimate rose 1.9%. This bullish trend justifies the Zacks Rank #2 (Buy) for the stock.
Other Key Picks
Other favorably ranked stocks in the same industry include Owens Corning Inc (OC - Free Report) , Grafton Group PLC (GROUF - Free Report) and NCI Building Systems, Inc. .
The company surpassed earnings estimates in all of the past four quarters, with an average beat of 35.13%.
Grafton, a Zacks Rank #2 stock, is expected to witness 13.8% earnings growth in 2017.
NCI Building, also a Zacks Rank #2 stock, is expected to witness 6.9% earnings growth in fiscal 2017.
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United Rentals (URI) Acquires NES Rentals for $965 Million
Equipment rental company United Rentals, Inc. (URI - Free Report) completed the acquisition of NES Rentals Holdings II, Inc. (“NES”). NES is one of the ten large general equipment rental companies in the U.S., providing specialized aerial equipment to approximately 18,000 customers across the industrial and non-residential construction sectors.
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Agreement Details
On Jan 25, United Rentals and Diamond Castle Holdings LLC, the majority owner of NES, entered into an agreement to acquire NES.
The total purchase price is approximately $965 million in cash, funded through a combination of newly issued unsecured debt and available capacity on the company’s ABL facility.
The assets acquired by United Rentals includes $900 million of fleet based on original cost, 73 branch facilities in the eastern half of the U.S. and approximately 1100 employees.
Benefits for United Rentals
The acquisition expands United Rentals’ geographic footprint in important markets like East Coast, Gulf States and Midwest. It is also expected to strengthen relationships with local and strategic accounts in the construction and industrial sectors, thus enhancing cross-selling capabilities.
The acquisition is also expected to leverage United Rentals’ technology and infrastructure. Management believes that the addition of NES will boost its revenues, earnings, EBITDA, free cash flow and overall scale.
Stock Price Movement
United Rentals’ shares have gained around 108.2% in the last one year, compared with the 27.5% increase of the Zacks categorized Building Products - Miscellaneous industry. Going forward, the NES acquisition is expected to significantly boost growth further, driving the stock’s performance in the upcoming quarters as well.
Meanwhile, the company’s current quarter consensus estimate moved 0.6% up while the current year consensus estimate rose 1.9%. This bullish trend justifies the Zacks Rank #2 (Buy) for the stock.
Other Key Picks
Other favorably ranked stocks in the same industry include Owens Corning Inc (OC - Free Report) , Grafton Group PLC (GROUF - Free Report) and NCI Building Systems, Inc. .
Owens Corning sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The company surpassed earnings estimates in all of the past four quarters, with an average beat of 35.13%.
Grafton, a Zacks Rank #2 stock, is expected to witness 13.8% earnings growth in 2017.
NCI Building, also a Zacks Rank #2 stock, is expected to witness 6.9% earnings growth in fiscal 2017.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>