- KeyBanc analyst Ken Newman raised the price target for Herc Holdings Inc (NYSE:HRI) to $165 (an upside of 41%) from $130 while maintaining the Overweight rating on the shares.
- The analyst states that following an eventful 2Q22 earnings season, they are reiterating a bullish view for Equipment Rental and Construction Machinery coverage.
- According to Newman, the improving non-res. construction trends should support more resilient earnings outlooks in both 2022 and 2023.
- Related: Herc Holdings Reports Mixed Q2 Results; Plans To Utilize 2014 Share Repurchase Authorization
- The analyst mentions that an acceleration in mega-project activity could support further upside to consensus estimates in coming years as recently passed federal stimulus packages become more meaningful beginning in 2023.
- The analyst says that solid acceleration in starts activity and continued resilience in other non-res. Macro trends should support continued rental momentum through 2H22 and into 2023.
- Newman believes that HRI is well positioned to benefit from improving organic demand and potential M&A, which could support the upside to both consensus estimates and the company’s full-year guidance.
- The analyst states that the improving non-res. Construction demand and continued progress on the company’s EBITDA margin expansion initiatives should support multiple expansions closer to HRI’s largest peers in the intermediate term.
- Price Action: HRI shares are trading lower by 2.48% at $116.80 on the last check Monday.
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