Herc Shares Drop After Q2 Earnings Miss: What Happened?

Herc Holdings Inc HRI reported second-quarter FY23 sales growth of 25.2% year-on-year to $802 million, missing the analyst consensus estimate of $814.65 million.

Equipment rental revenue increased 16% Y/Y to $702 million.

Selling, general and administrative expenses rose 14% Y/Y to $111 million.

Rental pricing increased 7.8% as compared to 2022.

Adjusted EBITDA rose 24% Y/Y to $352 million, and the adjusted EBITDA margin increased 50 basis points Y/Y to 43.9%.

Cash and equivalents totaled $37 million as of June 30, 2023. Operating cash for six months totaled $516 million.

Adjusted EPS of $2.69 missed the analyst consensus of $3.13.

Outlook: Herc reaffirmed FY23 adjusted EBITDA outlook of $1.45 billion-$1.55 billion.

Price Action: HRI shares are trading lower by 4.96% at $129.80 on the last check Tuesday.

Read Next: Top Wall Street Strategist Warns Of Possible Market Bubble, Points To Tech Concentration In S&P 500 And AI Hype