Hertz Global Holdings, Inc. (HTZ), Avis Budget Group Inc. (CAR), United Rentals, Inc. (URI): These 3 Companies Might Be Dangerous Investments

The good news is that United Rentals, Inc. (NYSE:URI) recently beat second-quarter earnings expectations, and rental revenue jumped 4.7% year over year. There has been strength in General Rentals as well as Trench Safety, Power & HVAC.

United Rentals, Inc. (NYSE:URI) has also opened three Power & HVAC branches for power generation and climate control, bringing the company’s total to 824 branches throughout the United States. These openings are a positive sign, as it indicates management is confident in the company’s prospects. If that wasn’t the case, then United Rentals would be closing branches, not opening them.

Conclusion

All three aforementioned companies are highly leveraged, and none of them have shown sustainable consistency on the top and bottom lines annually. Hertz and Avis Budget Group Inc. (NASDAQ:CAR) have also seen stock depreciation over the past month. With wage growth declining, consumers and businesses are less likely to spend money on travel, which affects car rental companies. A slowdown in the global economy would also affect United Rentals, Inc. (NYSE:URI). However, a slowdown in the global economy isn’t guaranteed, and United Rentals seems to be holding up well. That said, it’s still a risky investment, as downside risks outweigh upside potential.

The article These 3 Companies Might Be Dangerous Investments originally appeared on Fool.com and is written by Dan Moskowitz.

Dan Moskowitz has no position in any stocks mentioned. The Motley Fool owns shares of Hertz Global Holdings.

Dan is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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