Citadel Advisors exits position in United Rentals

Citadel Advisors’ new stock purchases include Workday, Inc. (WDAY) and Liberty TripAdvisors (LTRPA). The hedge fund exited positions in United Rentals (URI) and Akron, Inc. (AKRX). Citadel Advisors also increased positions in Tesoro Pertoleum Co. (TSO), Actavis Plc (ACT), Antero Resources Corp. (AR) and Anadarko Petroleum (APC). The firm decreased positions in Apple (AAPL), Citigroup (C), and Invesco Ltd. (IVZ).

Citadel Advisors exited stake in United Rentals by selling off shares worth $241 million. The shares accounted for 0.3225% of its previous portfolio.

United Rentals is the world’s largest equipment rental company. It was founded in 1997 by Bradley Jacobs and seven other individuals. United Rentals has over 880 rental locations in 49 US states and ten Canadian provinces. The company also sells new and used equipment. It offers safety training and 24/7 equipment service and support.

United Rentals’ customers include construction and industrial companies, utilities, municipalities, government agencies, and independent contractors.

Currently, United Rentals’ stock price is trading at $90.47—as of January 8, 2015. It’s down from 117.65 in August 2014. It fell almost 30% in a five-month period.

United Rentals’ stock price fell by 5% on October 7, 2014. It fell when Bank of America downgraded the stock to “sell” from “buy.” Also, the price target was lowered to $120 from $125. United Rentals has a 52-week low price of $62.01 and a 52-week high price of $119.83. The stock price also fell by over 5.36% in January 2015 due to a further downgrade by Evercore ISIS.

United Rentals’ 3Q14 results were announced on October 15, 2014. Its total revenue was $1.544 billion. Its rental revenue was $1.315 billion. Its total revenue and rental revenue was $1.311 billion and $1.138 billion, respectively, for the same period last year. The firm’s net income also increased from $143 million last year to $192 million in 3Q14.

The rental revenue increased by over 15% on a year-over-year, or YoY basis. The return on capital was 8.4% for the 12 months ending September 30, 2014. This was an increase of 1.3% from the 12 months ending on September 30, 2013.

As stated by United Rentals’ CEO, Michael Kneeland, “The third quarter provided further confirmation that our strategy and the North American construction recovery are both solidly on track. Our end markets are continuing to rally, creating numerous opportunities for well-managed, profitable growth.”

The next part in this series will explore Citadel Advisors’ exited position in Akorn, Inc.