Head to Head Comparison: TopBuild (NYSE:BLD) & United Rentals (NYSE:URI)
by Tristan Rich · The Markets DailyTopBuild (NYSE:BLD – Get Free Report) and United Rentals (NYSE:URI – Get Free Report) are both large-cap construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, risk, institutional ownership, earnings and analyst recommendations.
Valuation & Earnings
This table compares TopBuild and United Rentals”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| TopBuild | $5.41 billion | 2.20 | $521.73 million | $17.80 | 23.87 |
| United Rentals | $16.10 billion | 4.37 | $2.49 billion | $39.20 | 28.65 |
United Rentals has higher revenue and earnings than TopBuild. TopBuild is trading at a lower price-to-earnings ratio than United Rentals, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
95.7% of TopBuild shares are held by institutional investors. Comparatively, 96.3% of United Rentals shares are held by institutional investors. 0.5% of TopBuild shares are held by company insiders. Comparatively, 0.5% of United Rentals shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current ratings and target prices for TopBuild and United Rentals, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| TopBuild | 0 | 9 | 5 | 1 | 2.47 |
| United Rentals | 1 | 1 | 14 | 0 | 2.81 |
TopBuild currently has a consensus price target of $466.77, suggesting a potential upside of 9.84%. United Rentals has a consensus price target of $1,070.50, suggesting a potential downside of 4.68%. Given TopBuild’s higher probable upside, research analysts clearly believe TopBuild is more favorable than United Rentals.
Risk & Volatility
TopBuild has a beta of 1.8, indicating that its stock price is 80% more volatile than the S&P 500. Comparatively, United Rentals has a beta of 1.81, indicating that its stock price is 81% more volatile than the S&P 500.
Profitability
This table compares TopBuild and United Rentals’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| TopBuild | 8.95% | 23.53% | 8.61% |
| United Rentals | 15.32% | 30.56% | 9.23% |
Summary
United Rentals beats TopBuild on 12 of the 15 factors compared between the two stocks.
About TopBuild
TopBuild Corp., together with its subsidiaries, engages in the installation and distribution of insulation and other building material products to the construction industry. The company operates in two segments, Installation and Specialty Distribution. It provides insulation products and accessories, glass and windows, rain gutters, garage doors, fireplaces, roofing materials, closet shelving, and other products. The company also offers insulation installation services for fiberglass batts and rolls, blown-in loose fill fiberglass, polyurethane spray foam, and blown-in loose fill cellulose applications. In addition, it distributes building and mechanical insulation, insulation accessories, and other building product materials for the residential, commercial, and industrial end markets. The company serves single-family homebuilders, single-family custom builders, multi-family builders, commercial general contractors, remodelers, and individual homeowners, as well as insulation contractors, gutter contractors, weatherization contractors, other contractors, dealers, metal building erectors, and modular home builders. It operates installation branches and distribution centers in the United States and Canada. The company was formerly known as Masco SpinCo Corp. and changed its name to TopBuild Corp. in March 2015. TopBuild Corp. was incorporated in 2015 and is headquartered in Daytona Beach, Florida.
About United Rentals
United Rentals, Inc., through its subsidiaries, operates as an equipment rental company. It operates in two segments, General Rentals and Specialty. The General Rentals segment rents general construction and industrial equipment includes backhoes, skid-steer loaders, forklifts, earthmoving equipment, and material handling equipment; aerial work platforms, such as boom and scissor lifts; and general tools and light equipment comprising pressure washers, water pumps, and power tools for construction and industrial companies, manufacturers, utilities, municipalities, homeowners, and government entities. The specialty segment rents specialty construction products, including trench safety equipment consists of trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers, and line testing equipment for underground work; power and heating, ventilating, and air conditioning equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment; fluid solutions equipment for fluid containment, transfer, and treatment; and mobile storage equipment and modular office space. This segment serves construction companies involved in infrastructure projects, and municipalities and industrial companies. It also sells aerial lifts, reach forklifts, telehandlers, compressors, and generators; construction consumables, tools, small equipment, and safety supplies; and parts for equipment that is owned by its customers, as well as provides repair and maintenance services. The company sells used equipment through its sales force, brokers, website, at auctions, and directly to manufacturers. The company operates in the United States, Canada, Europe, Australia, and New Zealand. United Rentals, Inc. was incorporated in 1997 and is headquartered in Stamford, Connecticut.