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United Rentals to Benefit From Construction Spending Rebound, UBS Says

BY MT Newswires | ECONOMIC | 01/05/26 12:20 PM EST

12:20 PM EST, 01/05/2026 (MT Newswires) -- United Rentals' (URI) core profit growth is likely to accelerate as a rebound in non-residential construction activity begins in the second half of this year, UBS Securities said in a note e-mailed Monday.

The brokerage is projecting 5% year-over-year growth in the equipment rental company's earnings before interest, taxes, depreciation, and amortization this year, followed by a 7.2% jump in 2027. That compares with an estimated 3% rise last year.

Potential merger and acquisition transactions over the next 12 months could provide an additional upside, according to UBS analysts, including Steven Fisher.

Between 2025 and 2027, UBS is looking at 13% growth in adjusted EBITDA, compared with the consensus estimate for an 11% increase.

"We expect US non-residential construction spending will return to growth in mid-2026, following declines since November 2024," Fisher wrote. "We expect the re-acceleration will be driven by large projects in life sciences, infrastructure, data centers, and power, as well as a neutralizing of declines in commercial."

UBS upgraded its rating on the stock to buy from neutral, with a price target of $1,025. United Rentals' (URI) shares were up 6.9% intraday Monday.

UBS anticipates non-residential construction spending to grow by about 4% this year and by 5.5% in 2027, after declining by an estimated 1% last year. The resurgence in construction activity should boost rental volumes and margins for United Rentals (URI), the brokerage said.

UBS raised its adjusted EBITDA estimates for the company to $7.74 billion from $7.64 billion for 2026 and to $8.3 billion from $8.14 billion for 2027. Its 2025 outlook remains at $7.37 billion.

"We expect margins will remain down (year over year in the first half of 2026), before a positive inflection in (the second half) as activity picks up," Fisher said.

Price: 898.16, Change: +53.10, Percent Change: +6.28

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.

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