Download PDF

1. Company Snapshot

1.a. Company Description

Herc Holdings Inc., through its subsidiaries, operates as an equipment rental supplier in the United States and internationally.It rents aerial, earthmoving, material handling, trucks and trailers, air compressors, compaction, and lighting equipment.The company also provides ProSolutions, an industry specific solution-based services, which include power generation, climate control, remediation and restoration, pump, trench shoring, and studio and production equipment; and ProContractor professional grade tools.


In addition, it offers various services, including repair, maintenance, equipment management, and safety training; and equipment re-rental and on-site support services, as well as ancillary services, such as equipment transport, rental protection, cleaning, refueling, and labor.Further, the company sells used equipment and contractor supplies, such as construction consumables, tools, small equipment, and safety supplies.It serves non-residential and residential construction, specialty trade, restoration, remediation and environment, and facility maintenance contractors; industrial manufacturing industries, including automotive and aerospace, power, metals and mining, agriculture, pulp, paper and wood, food and beverage, and refineries and petrochemical industries; infrastructure and government sectors; and commercial facilities, hospitality, healthcare, recreation, entertainment production, and special event management customers.


The company sells its products through its sales team and industry catalogs, as well as through participation and sponsorship of industry events, trade shows, and Internet.Herc Holdings Inc.was founded in 1965 and is based in Bonita Springs, Florida.

Show Full description

1.b. Last Insights on HRI

Breaking News: Herc Holdings Inc reported Q4 2025 earnings on February 12 2026. The company reported revenue of 588 million and EPS of 2.71. Channing Capital Management LLC recently cut its stake in Herc Holdings by 0.9% to 612552 shares. The companys CEO stated that they are optimistic about 2026. Goldman Sachs analyst upgraded the stock to buy from neutral with a price target of 65. Morgan Stanley analyst maintained a hold rating. Wedbush analyst maintained a buy rating.

1.c. Company Highlights

2. Herc Holdings' 2025 Earnings: A Transformational Year

Herc Holdings Inc. reported a strong fourth quarter and full year 2025, driven by the acquisition of H&E in June. Equipment rental revenue surged 24% year over year, fueled by the acquisition, mega projects, and sales of specialty solutions. Adjusted EBITDA increased 19% compared to the previous year's fourth quarter, with a 53% jump in used equipment sales. The company reported net income of $69,000,000, or $2.07 per share, on an adjusted basis, for the fourth quarter, beating estimates of $1.87. For the full year, results were in line with early expectations, with significant progress made in integrating the acquired assets.

Publication Date: Feb -22

📋 Highlights
  • Q4 Revenue Growth:: Equipment rental revenue rose 24% YoY, driven by H&E acquisition, mega projects, and specialty solutions sales.
  • Adjusted EBITDA Expansion:: Increased 19% YoY, with used equipment sales surging 53% and full-year guidance at $2–2.1B (10–16% growth).
  • 2026 Capital Allocation:: $950M in gross CapEx and $400–600M free cash flow expected, with $700M allocated to fleet rotation.
  • Synergy Realization:: $125M cost synergies targeted in 2026, alongside $235M total EBITDA growth (60–70% from synergies).
  • Market Position Strengthened:: 50 new specialty locations, 25% network expansion, and 10–15% mega project market share target post-integration.

Guidance and Outlook

The company provided its 2026 guidance, expecting rental revenue growth of 13% to 17%, with a focus on completing the integration, capturing synergies, and optimizing its stronger foundation. Herc plans to invest roughly $950,000,000 of gross capital expenditures and expects to generate free cash flow in the range of $400,000,000 to $600,000,000. The company expects to recognize a total of $125,000,000 of cost synergies in 2026, supporting REBITDA margin improvement.

Operational Highlights

The combined company's fundamentals are stronger, with a stable market and increasing focus on mega projects, such as manufacturing, LNG, renewables, and data centers. In 2025, local accounts represented 51% of rental revenue, with a target of 60% local and 40% national revenue long-term. The company expects 2026 to be relatively neutral to 2025, with government infrastructure, MRO, and institutional construction demand offsetting moderate commercial sector growth.

Valuation and Metrics

With a P/E Ratio of 51.10 and an EV/EBITDA of 14.74, the market appears to be pricing in significant growth expectations. The company's ROIC stands at 5.7%, indicating a decent return on invested capital. However, the Net Debt / EBITDA ratio is high at 10.1, which may be a concern. Analysts estimate next year's revenue growth at 5.6%, which may not be sufficient to justify the current valuation multiples.

Future Prospects

Herc Rentals is well-positioned to accelerate growth after a successful integration phase. The company expects EBITDA expansion of $230 million, with $190 million from synergies, and positive pricing, stable local markets, and growth in mega projects contributing to the growth. With a strong foundation and a focus on being more capital efficient, Herc is poised for profitable growth in 2026.

3. NewsRoom

Card image cap

Channing Capital Management LLC Cuts Stake in Herc Holdings Inc. $HRI

Feb -22

Source: defenseworld.net

Card image cap

Herc Holdings Inc. (HRI) Presents at Citi's Global Industrial Tech & Mobility Conference 2026 Transcript

Feb -19

Source: seekingalpha.com

Card image cap

Herc Q4 Earnings Call Highlights

Feb -19

Source: defenseworld.net

Card image cap

Herc Holdings Inc. (HRI) Presents at Barclays 43rd Annual Industrial Select Conference Transcript

Feb -18

Source: seekingalpha.com

Card image cap

HRI or WAB: Which Is the Better Value Stock Right Now?

Feb -18

Source: zacks.com

Card image cap

Herc Holdings Inc. (HRI) Q4 2025 Earnings Call Transcript

Feb -17

Source: seekingalpha.com

Card image cap

Herc Holdings (HRI) Q4 Earnings Top Estimates

Feb -17

Source: zacks.com

Card image cap

Herc Holdings Reports Full Year 2025 Results and Announces 2026 Full Year Guidance

Feb -17

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.54%)

6. Segments

Equipment Rental

Expected Growth: 7.5%

Herc Holdings Inc.'s equipment rental segment growth of 7.5% is driven by increasing construction activities, infrastructure development, and rising demand for equipment in the oil and gas industry. Additionally, the company's strategic acquisitions, expanded product offerings, and investments in technology have enhanced operational efficiency, contributing to the segment's growth.

Rental Equipment

Expected Growth: 7.8%

Herc Holdings Inc.'s 7.8% rental equipment growth driven by increasing construction activities, infrastructure development, and rising demand for equipment rentals in the oil and gas sector. Additionally, strategic acquisitions, expanded product offerings, and a strong focus on customer service have contributed to the growth.

New Equipment, Parts and Supplies

Expected Growth: 8.2%

Herc Holdings Inc.'s 8.2% growth in New Equipment, Parts and Supplies is driven by increasing demand for construction and industrial equipment, rising infrastructure spending, and a growing need for equipment replacement. Additionally, the company's strategic acquisitions and investments in digital platforms have enhanced its product offerings and customer experience, contributing to the segment's growth.

Service and Other

Expected Growth: 7.2%

Herc Holdings Inc.'s 7.2% growth in Service and Other segment is driven by increased equipment rental demand, expansion of ProSolutions and ProContractor tools, and strategic acquisitions. Additionally, the company's focus on digital transformation, cost savings initiatives, and a strong used equipment market also contributed to the growth.

7. Detailed Products

Equipment Rentals

Herc Holdings Inc. offers a wide range of equipment rentals for construction, industrial, and commercial applications, including aerial lifts, forklifts, and generators.

ProSolutions

ProSolutions is a suite of services and solutions designed to help customers manage their equipment and operations more efficiently, including equipment tracking, maintenance scheduling, and fleet optimization.

ProContractor

ProContractor is a comprehensive equipment rental and services solution designed specifically for contractors, including equipment rentals, delivery, and maintenance support.

Used Equipment Sales

Herc Holdings Inc. offers a range of used equipment for sale, including aerial lifts, forklifts, and generators, with options for financing and maintenance support.

Disaster Recovery Services

Herc Holdings Inc. provides disaster recovery services, including equipment rentals, logistics, and support, to help customers respond to natural disasters and other crises.

8. Herc Holdings Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Herc Holdings Inc. is medium due to the availability of alternative equipment rental options for customers.

Bargaining Power Of Customers

The bargaining power of customers is low due to the specialized nature of Herc Holdings Inc.'s equipment rental services, making it difficult for customers to negotiate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of multiple suppliers for equipment and services, but Herc Holdings Inc.'s large scale of operations gives it some negotiating power.

Threat Of New Entrants

The threat of new entrants is low due to the high capital requirements and regulatory hurdles involved in entering the equipment rental industry.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the equipment rental industry, leading to intense competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 74.55%
Debt Cost 6.44%
Equity Weight 25.45%
Equity Cost 15.34%
WACC 8.71%
Leverage 292.93%

11. Quality Control: Herc Holdings Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
FTAI Aviation

A-Score: 5.5/10

Value: 3.0

Growth: 4.7

Quality: 6.9

Yield: 6.0

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
McGrath Rent

A-Score: 5.5/10

Value: 4.7

Growth: 7.7

Quality: 6.7

Yield: 4.0

Momentum: 2.0

Volatility: 8.0

1-Year Total Return ->

View Full Report
Stock-Card
Avis Budget Group

A-Score: 5.2/10

Value: 8.6

Growth: 5.8

Quality: 3.9

Yield: 1.0

Momentum: 8.5

Volatility: 3.7

1-Year Total Return ->

View Full Report
Stock-Card
Fortress Transportation

A-Score: 5.0/10

Value: 3.0

Growth: 4.7

Quality: 6.9

Yield: 6.0

Momentum: 6.0

Volatility: 3.3

1-Year Total Return ->

View Full Report
Stock-Card
FTAI Aviation

A-Score: 4.6/10

Value: 3.0

Growth: 4.7

Quality: 6.9

Yield: 5.0

Momentum: 6.0

Volatility: 2.0

1-Year Total Return ->

View Full Report
Stock-Card
Herc

A-Score: 4.5/10

Value: 7.6

Growth: 7.2

Quality: 4.0

Yield: 3.0

Momentum: 2.0

Volatility: 3.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

153.46$

Current Price

153.46$

Potential

-0.00%

Expected Cash-Flows