Analyzing United Rentals (URI) & G&K Services (NASDAQ:GKSR)

G&K Services (NASDAQ: GKSR) and United Rentals (NYSE:URI) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, profitabiliy and institutional ownership.

Profitability

This table compares G&K Services and United Rentals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
G&K Services 3.79% 9.12% 4.03%
United Rentals 9.86% 46.01% 6.42%

Analyst Recommendations

This is a breakdown of current recommendations for G&K Services and United Rentals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
G&K Services 0 0 0 0 N/A
United Rentals 2 5 10 0 2.47

United Rentals has a consensus price target of $124.21, indicating a potential upside of 5.82%. Given United Rentals’ higher probable upside, analysts plainly believe United Rentals is more favorable than G&K Services.

Insider & Institutional Ownership

95.1% of United Rentals shares are owned by institutional investors. 1.2% of United Rentals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares G&K Services and United Rentals’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
G&K Services N/A N/A N/A N/A N/A
United Rentals $5.98 billion 1.66 $1.75 billion $6.89 17.04

United Rentals has higher revenue and earnings than G&K Services.

Summary

United Rentals beats G&K Services on 8 of the 8 factors compared between the two stocks.

About G&K Services

G&K Services, Inc. is a service-focused provider of branded uniform and facility services programs. The Company provides a range of workwear and protective safety apparel through rental and direct purchase programs. The Company also supplies various facility products and services, including floor mats, towels, mops, restroom hygiene products, and first aid supplies. It also manufactures certain work apparel garments that are used to support its garment rental and direct purchase programs. It operates in two segments: United States (includes the Dominican Republic) and Canada. The Company operated from approximately 160 locations, as of July 2, 2016. The Company serves a diverse base of customer locations in various industries, including automotive, warehousing, distribution, transportation, energy, manufacturing, food processing, retail, restaurants, construction and trades, hospitality, government, healthcare and others.

About United Rentals

United Rentals, Inc. is a holding company. The Company is an equipment rental company, which operates throughout the United States and Canada. It operates through two segments: general rentals, and trench, power and pump. The general rentals segment includes the rental of construction, aerial, industrial and homeowner equipment and related services and activities. The trench, power and pump segment includes the rental of specialty construction products and related services. Its general rentals segment includes the rental of general construction and industrial equipment, such as backhoes, skid-steer loaders, forklifts and material handling equipment; aerial work platforms, such as boom lifts and scissor lifts, and general tools and light equipment, such as pressure washers, water pumps and power tools. As of January 1, 2017, it operated 887 rental locations. The Company conducts its operations through its subsidiary, United Rentals (North America), Inc. (URNA) and subsidiaries of URNA.

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