Update: Electro Rent Q3 Mixed Earnings - Sales Revenue Up, Rental Revenue And Margins Falling
Martin Vlcek • Mon, Oct. 6
- Electro Rent reported a mixed quarter as overall revenue rose 2.8% Y/Y. While rental revenue was down 5% Y/Y, sales of equipment rose a strong 14% Y/Y. Margin mix was unfavorable.
- As was expected in my thesis, ELRC performance continued to disappoint. Thanks to the fall in the stock price, the dividend yield is now 5.7%.
- I reiterate my long ELRC thesis and the $16.70 target price within two years, offering a 20% two-year upside plus the 5.7% annual dividend yield.