Herc Holdings Inc. (HRI) vs Vestis Corporation (VSTS)

Herc Holdings Inc. and Vestis Corporation are both Rental & Leasing Services companies. Herc Holdings Inc. is the larger, with a market value of $4.2B against $1.9B — 2.2× the size. Vestis Corporation has negative trailing earnings, so its P/E is not meaningful; Herc Holdings Inc. trades at 82.7×. Herc Holdings Inc. grew revenue faster over the last twelve months: 28.5% against −0.39%. Herc Holdings Inc. has the higher net margin (1.01% vs −0.20%) and the higher return on invested capital (4.04% vs 2.97%). Only Herc Holdings Inc. pays a dividend (2.30%). Across the 22 metrics below, Herc Holdings Inc. leads on 16 and Vestis Corporation on 6.

Valuation

Metric HRI VSTS Rental & Leasing Services median
P/E 82.70 n/m 18.17
P/S 0.84 0.68 0.92
P/B 2.15 2.10 2.15
Price to free cash flow 10.20 12.81 7.80
EV/EBITDA 6.28 12.64 7.72
EV/Sales 2.48 1.12 2.47
Earnings yield 1.21% (0.36%) 1.00%
Free cash flow yield 9.80% 7.81% 1.43%

Profitability

Metric HRI VSTS Rental & Leasing Services median
Gross margin 51.98% 26.30% 49.40%
Operating margin 13.12% 3.64% 8.49%
Net margin 1.01% (0.20%) 1.01%
Free cash flow margin 8.20% 5.33% 1.87%
Return on equity 2.58% (0.60%) 12.13%
Return on assets 0.35% (0.18%) 0.24%
Return on invested capital 4.04% 2.97% 2.80%

Growth

Metric HRI VSTS Rental & Leasing Services median
Revenue growth (TTM) 28.50% (0.39%) 3.21%
EPS growth (last fiscal year) (99.59%) (293.75%) (8.44%)
Revenue growth, 5-year CAGR 19.69% 1.31% 12.97%
Net income growth, 5-year CAGR (57.68%) 0.00% 0.00%

Health

Metric HRI VSTS Rental & Leasing Services median
Debt to equity 4.24 1.42 1.48
Current ratio 1.10 2.17 1.36
Net debt to EBITDA 4.61 6.12 4.32

Dividend

Metric HRI VSTS Rental & Leasing Services median
Dividend yield 2.30% 0.00% 1.56%
Payout ratio 1.90 — 0.22

Size

Metric HRI VSTS Rental & Leasing Services median
Market cap 4.15b 1.90b 2.43b

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