Jim Cramer Says “I Don’t Think United Rentals Is a Lost Cause”

United Rentals, Inc. (NYSE:URI) is one of the stocks Jim Cramer shed light on recently. Cramer highlighted the company’s “weak results,” and commented:

Next, United Rentals plunged nearly 13%. The company reported weak results Wednesday night. That could be a sign for the economy. I get it. This big equipment rental company has reported an outright miss with mildly softer than expected sales and much softer than expected earnings. Full-year forecast for revenue and EBITDA and cash flow also came in light. What’s the problem here?

Okay, in the construction market, there is some building happening, but a lot of it’s coming from large companies doing mega projects, which is bad for United Rentals because the big boys can drive a much harder bargain than, say, some of the smaller home builders. Overall, I don’t think United Rentals is a lost cause. Stock’s now cheap, trading… less than 17 times this year’s earnings estimates. Management also announced a $5 billion buyback. That’s equivalent to more than 10% of its market cap.

But as one analyst put it this week, the stock “may remain in purgatory” for a bit until investors have confidence in a broader construction market recovery or see some signs that United Rentals margins are moving in the right direction. In truck rental, we now like EquipmentShare, which recently came public. That’s a faster grower with an asset-lighter model… I really, really like it.

Photo by Nicholas Cappello on Unsplash

United Rentals, Inc. (NYSE:URI) provides equipment rental solutions, as it offers machinery such as earthmoving equipment, aerial lifts, and power tools. Additionally, the company rents specialty equipment for trench safety, power generation, HVAC, and fluid management.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.