United Rentals Price Target Bumped Up By ~13% At KeyBanc

KeyBanc analyst Ken Newman raised the price target for United Rentals, Inc. URI to $425 (an upside of 37.9%) from $375 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.
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.
Newman expects to see continued growth in larger projects to support secular build-outs for semiconductor fabs, industrial reshoring, and energy/petrochem production, which should more heavily favor URI vs. its smaller competitors given its position as the largest player in the industry, he further added.
The analyst believes that potential benefits from infrastructure and other federal stimulus packages are not being reflected in URI stock. He thinks these projects could contribute more than ~$1 billion in incremental EBITDA once groundbreaking begins to ramp.
Price Action: URI shares are trading lower by 2.64% at $308.32 on the last check Monday.

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