Tuesday, January 10, 2017

United Rentals, Inc [URI]

United Rentals, Inc.   [URI]

     Coming from a little bit of a different direction with this one. It it still related to the other two, but they don't produce any materials or consult with any construction. Probably guessed it based on the company name, but they are as simple as an equipment rental company. They have general rentals which go towards the construction and industrial industry and a Trench, Power, and Pump segment. That one targets more of the underground work. Pretty self explanatory stuff based on names with this one. They have just under 900 rental locations in North America.

     After the preliminary research based purely as a scan over the charts and reading article headlines this company seems poised gain more in the short term and continue into longer term. I'm sure the people who read this (thanks) know, if you search the ticker symbol on finviz and scroll down you can see a ton of links to articles mentioned the company for the last 3-4 months. In an article on Yahoo! titled,  "Top Ranked Value Stocks to Buy for December 14th", they mention that URI is a good buy right now with all that will be going on and that their P/E of 12.82 is lower than the industry average at 19.18. Also worth mentioning is that they received a Zacks ranking of 2 from Zacks.com. The Street also ranks them with a B as a buy. 

Charts charts charts.

     The daily chart. Once again, IF I were to give advice, which I am not, I would not be buying this right now. However, I would be watching this one very close. They had a good day on Tuesday the 10th and the RSI saw a bump up above 50. The MACD is still trending downward along with the stochastic. There was the over 40% increase in share price after the election and hasn't been much pullback, but I don't think a whole lot is coming and I'll explain why in the paragraph below. 

     The Golden Cross. Like I have been saying in all my most recent posts, the moving averages are looking good. The 50 day exponential just crossed above the 200 day normal moving average in a bullish sign. The other 50 day average is still below, but curving upward same as the exponential. If you don't know, the normal 50 day moving average is simply an average price from the last 50 days. The exponential moving average puts more weight on the most recent prices. It follows the current trends a little more closely. The negative looking aspects about this chart is basically the rest. The RSI shows an inflated price. The stochastic shows the same thing, heavily overbought. As does the MACD. The very large positive number is scary. The more I look and the more I write this...the more I dislike this stock right now. I think over the long term they should post some gains and growth, but after seeing these indicators there will most likely be a drop in price soon. The 40% leap post election created a false cross there and after the imminent "correction" the moving averages will fall below the 200 once again. A buy point will present itself later on, but I don't believe right now is the time. A lot of the positivity was priced into the stock the days after the election and with the price still overbought and inflated there should be a harder pullback in days/weeks to come. Maybe. Obviously all of this is a big maybe. 

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