Herc (NYSE:HRI) Posts Quarterly Earnings Results, Beats Expectations By $0.99 EPS

Herc (NYSE:HRI) announced its quarterly earnings results on Tuesday. The transportation company reported $3.91 EPS for the quarter, topping the consensus estimate of $2.92 by $0.99, FiscalAI reports. The business had revenue of $1.36 billion for the quarter, compared to analyst estimates of $1.35 billion. Herc had a return on equity of 10.33% and a net margin of 1.01%. The company’s quarterly revenue was up 4.6% on a year-over-year basis. During the same quarter in the previous year, the company earned $2.22 EPS.

Here are the key takeaways from Herc’s conference call:

• Third-quarter performance was strong: equipment rental revenue rose nearly 12% on less than 2% average OEC fleet growth, while dollar utilization increased 360 basis points and adjusted REBITDA margin expanded to 44.2%.
• Herc raised its full-year outlook, targeting approximately $4.513 billion of equipment rental revenue and $2.13 billion of adjusted REBITDA, both about 2% above prior guidance, supported by robust mega-project demand and growing revenue synergies.
• Management plans to invest an additional roughly $150 million of net fleet CapEx, primarily in specialty equipment tied to identified, multi-year mega-project assignments; executives said the assets should begin contributing to REBITDA in the fourth quarter and strengthen the 2027 earnings base.
• CEO Larry Silber will transition to executive chairman on January 1, 2027, with longtime executive Aaron Birnbaum becoming CEO; management characterized the change as a planned succession reflecting leadership continuity.
• Core rental REBITDA margin declined 70 basis points to 45.2%, as operating-cost inflation, higher incentive compensation, and fuel and freight costs more than offset rental growth and pricing improvements. Local markets remain stable but commercial construction is still pressured by interest-rate sensitivity, while management said pricing has not yet fully offset inflation.

Herc Trading Up 13.1%

Shares of NYSE HRI traded up $16.60 during mid-day trading on Tuesday, hitting $143.73. The stock had a trading volume of 298,213 shares, compared to its average volume of 607,646. The business has a 50 day moving average price of $140.38 and a two-hundred day moving average price of $139.59. The company has a debt-to-equity ratio of 4.22, a quick ratio of 1.10 and a current ratio of 1.10. The firm has a market cap of $4.80 billion, a P/E ratio of 97.16 and a beta of 2.04. Herc has a 1 year low of $88.45 and a 1 year high of $188.35.

Herc Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Wednesday, September 16th. Shareholders of record on Wednesday, September 2nd were given a dividend of $0.70 per share. This represents a $2.80 annualized dividend and a yield of 1.9%. The ex-dividend date was Wednesday, September 2nd. Herc’s dividend payout ratio is presently 190.48%.

Analyst Ratings Changes

HRI has been the subject of several recent research reports. Zacks Research raised Herc from a “hold” rating to a “strong-buy” rating in a report on Monday, September 14th. JPMorgan Chase & Co. raised shares of Herc from a “neutral” rating to an “overweight” rating and increased their price target for the stock from $165.00 to $175.00 in a research report on Thursday, September 10th. Citigroup cut their price target on Herc from $175.00 to $150.00 and set a “buy” rating on the stock in a research note on Monday, October 12th. Wells Fargo & Company reduced their price target on shares of Herc from $218.00 to $176.00 and set an “overweight” rating for the company in a report on Thursday, October 8th. Finally, KeyCorp boosted their price objective on shares of Herc from $165.00 to $185.00 and gave the stock an “overweight” rating in a research note on Wednesday, July 29th. One analyst has rated the stock with a Strong Buy rating, six have issued a Buy rating and two have given a Hold rating to the stock. According to MarketBeat.com, Herc currently has an average rating of “Moderate Buy” and an average price target of $174.86.

Key Stories Impacting Herc

Here are the key news stories impacting Herc this week:

• Positive Sentiment: Third-quarter earnings beat estimates. Herc reported adjusted earnings of $3.91 per share, well above the $3.08 Zacks consensus and the $2.92 estimate cited by other coverage. EPS also rose from $2.22 a year earlier, indicating significant year-over-year earnings growth. Herc Holdings Q3 Earnings and Revenues Beat Estimates
• Positive Sentiment: Revenue reached a record $1.36 billion. Quarterly revenue increased approximately 4.6% to 5% year over year and slightly exceeded the $1.35 billion analyst expectation. Equipment rental revenue grew 12% on an average fleet investment base, reflecting stronger customer demand and rental activity. Herc Holdings Reports Third Quarter 2026 Results
• Neutral Sentiment: CEO succession was announced. President Aaron Birnbaum will succeed Larry Silber as CEO on January 1, 2027, while continuing as president and joining the board. The planned transition provides continuity, but investors may watch for changes in strategy, capital allocation and operating execution. Herc Holdings Announces CEO Succession Plan
• Negative Sentiment: Full-year guidance remains a concern. Herc increased its 2026 guidance, but reports indicate the revised full-year sales outlook is still materially below analyst expectations. That shortfall may offset some of the quarterly earnings strength and raise questions about demand, fleet utilization and future growth.

Herc Company Profile

Herc Holdings Inc, operating primarily through the Herc Rentals brand, is an equipment rental supplier serving construction, industrial, commercial and government customers. The company provides access to equipment and related services intended to help customers complete projects without purchasing and maintaining their own fleets.

Its rental fleet includes aerial work platforms, earthmoving equipment, material-handling equipment, trucks and trailers, power generation and climate-control equipment, pumps, and general tools.