United Rentals (NYSE: URI) and Ituran Location and Control (NASDAQ:ITRN) are both construction companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, analyst recommendations, profitability, institutional ownership and valuation.

Analyst Recommendations

This is a breakdown of current ratings and target prices for United Rentals and Ituran Location and Control, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United Rentals 1 4 11 0 2.63
Ituran Location and Control 0 0 1 0 3.00

United Rentals presently has a consensus target price of $126.92, indicating a potential upside of 0.18%. Ituran Location and Control has a consensus target price of $31.00, indicating a potential downside of 7.46%. Given United Rentals’ higher possible upside, research analysts clearly believe United Rentals is more favorable than Ituran Location and Control.

Dividends

Ituran Location and Control pays an annual dividend of $0.96 per share and has a dividend yield of 2.9%. United Rentals does not pay a dividend. Ituran Location and Control pays out 49.2% of its earnings in the form of a dividend.

Insider & Institutional Ownership

93.7% of United Rentals shares are held by institutional investors. Comparatively, 51.8% of Ituran Location and Control shares are held by institutional investors. 1.2% of United Rentals shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares United Rentals and Ituran Location and Control’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
United Rentals $5.98 billion 1.79 $1.75 billion $6.89 18.39
Ituran Location and Control $218.77 million 3.21 $65.10 million $1.95 17.18

United Rentals has higher revenue and earnings than Ituran Location and Control. Ituran Location and Control is trading at a lower price-to-earnings ratio than United Rentals, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

United Rentals has a beta of 2.42, indicating that its share price is 142% more volatile than the S&P 500. Comparatively, Ituran Location and Control has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500.

Profitability

This table compares United Rentals and Ituran Location and Control’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United Rentals 9.86% 46.01% 6.42%
Ituran Location and Control 18.67% 36.12% 22.00%

Summary

United Rentals beats Ituran Location and Control on 11 of the 16 factors compared between the two stocks.

United Rentals Company Profile

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.

Ituran Location and Control Company Profile

Ituran Location and Control Ltd. is a provider of location-based services, consisting of stolen vehicle recovery (SVR), fleet management services and other tracking services. The Company also provides wireless communication products used in connection with its location-based services and various other applications. Its operations consist of two segments: location-based services and wireless communications products. Its location-based services segment consists of its SVR and tracking services, fleet management and value-added services consisted of personal locater services and concierge services. Its wireless communications products segment consists of short and medium range two-way machine-to-machine wireless communications products that are used for various applications, including automatic vehicle location (AVL) and automatic vehicle identification. It primarily provides its services, as well as sells and leases its products in Israel, Brazil, Argentina and the United States.

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