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Herc Holdings Inc. (HRI) vs McGrath RentCorp (MGRC)

Herc Holdings Inc. and McGrath RentCorp are both Rental & Leasing Services companies. Herc Holdings Inc. is the larger, with a market value of $4.2B against $2.8B — 1.5× the size. McGrath RentCorp trades at the lower P/E: 18.2× against 82.7×. Herc Holdings Inc. grew revenue faster over the last twelve months: 28.5% against −0.92%. McGrath RentCorp has the higher net margin (16.4% vs 1.01%) and the higher return on invested capital (12.0% vs 4.04%). Both pay a dividend; Herc Holdings Inc. yields more (2.30% vs 2.17%). Across the 23 metrics below, McGrath RentCorp leads on 12 and Herc Holdings Inc. on 11.

Valuation

Metric HRI MGRC Rental & Leasing Services median
P/E 82.70 18.17 18.17
P/S 0.84 2.97 0.92
P/B 2.15 2.22 2.15
Price to free cash flow 10.20 35.04 7.80
EV/EBITDA 6.28 7.93 7.72
EV/Sales 2.48 2.96 2.47
Earnings yield 1.21% 5.50% 1.00%
Free cash flow yield 9.80% 2.85% 1.43%

Profitability

Metric HRI MGRC Rental & Leasing Services median
Gross margin 51.98% 48.52% 49.40%
Operating margin 13.12% 25.47% 8.49%
Net margin 1.01% 16.38% 1.01%
Free cash flow margin 8.20% 8.46% 1.87%
Return on equity 2.58% 12.69% 12.13%
Return on assets 0.35% 6.33% 0.24%
Return on invested capital 4.04% 11.96% 2.80%

Growth

Metric HRI MGRC Rental & Leasing Services median
Revenue growth (TTM) 28.50% (0.92%) 3.21%
EPS growth (last fiscal year) (99.59%) (32.66%) (8.44%)
Revenue growth, 5-year CAGR 19.69% 10.52% 12.97%
Net income growth, 5-year CAGR (57.68%) 8.92% 0.00%

Health

Metric HRI MGRC Rental & Leasing Services median
Debt to equity 4.24 0.00 1.48
Current ratio 1.10 0.26 1.36
Net debt to EBITDA 4.61 0.00 4.32

Dividend

Metric HRI MGRC Rental & Leasing Services median
Dividend yield 2.30% 2.17% 1.56%
Payout ratio 1.90 0.40 0.22

Size

Metric HRI MGRC Rental & Leasing Services median
Market cap 4.15b 2.76b 2.43b

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