McGrath RentCorp (NASDAQ:MGRC) Shares Pass Above 200-Day Moving Average - What's Next?

Key Points

• Price breakout: MGRC crossed above its 200-day moving average
• Earnings beat and solid margins: McGrath reported Q results of $2.02 EPS (vs. $1.74 expected) and $256.8M revenue (vs. $254.3M expected), with a net margin of 16.55% and ROE of 13.21%.
• Analyst view and shareholder returns: The stock carries a consensus rating of "Moderate Buy" with an average price target of $141.50 (Barclays at $140), the company raised its quarterly dividend to $0.495 (1.7% yield), and institutional ownership is about 92% with recent increases by several funds.

McGrath RentCorp (NASDAQ:MGRC - Get Free Report) crossed above its 200-day moving average during trading on Monday . The stock has a 200-day moving average of $109.97 and traded as high as $114.87. McGrath RentCorp shares last traded at $114.33, with a volume of 102,290 shares changing hands.

Wall Street Analysts Forecast Growth

MGRC has been the subject of several recent analyst reports. Barclays initiated coverage on shares of McGrath RentCorp in a research note on Wednesday, February 11th. They set an "overweight" rating and a $140.00 price objective for the company. Weiss Ratings restated a "hold (c+)" rating on shares of McGrath RentCorp in a report on Tuesday, January 27th. Finally, Zacks Research raised shares of McGrath RentCorp from a "strong sell" rating to a "hold" rating in a research note on Thursday, January 15th. Two investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat, McGrath RentCorp currently has a consensus rating of "Moderate Buy" and an average price target of $141.50.

McGrath RentCorp Price Performance

The firm has a 50-day moving average price of $111.40 and a two-hundred day moving average price of $109.97. The firm has a market capitalization of $2.81 billion, a P/E ratio of 18.00, a P/E/G ratio of 1.13 and a beta of 0.49.

McGrath RentCorp (NASDAQ:MGRC - Get Free Report) last released its quarterly earnings data on Wednesday, February 25th. The financial services provider reported $2.02 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.74 by $0.28. The company had revenue of $256.76 million during the quarter, compared to analysts' expectations of $254.32 million. McGrath RentCorp had a net margin of 16.55% and a return on equity of 13.21%. Sell-side analysts predict that McGrath RentCorp will post 6.18 earnings per share for the current fiscal year.

McGrath RentCorp Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, April 30th. Investors of record on Thursday, April 16th will be paid a $0.495 dividend. This represents a $1.98 annualized dividend and a yield of 1.7%. This is an increase from McGrath RentCorp's previous quarterly dividend of $0.49. The ex-dividend date of this dividend is Thursday, April 16th. McGrath RentCorp's payout ratio is currently 31.18%.

Institutional Investors Weigh In On McGrath RentCorp

Hedge funds have recently made changes to their positions in the company. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. raised its holdings in shares of McGrath RentCorp by 4.6% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 14,528 shares of the financial services provider's stock valued at $1,618,000 after acquiring an additional 639 shares in the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its holdings in shares of McGrath RentCorp by 5.4% in the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 77,256 shares of the financial services provider's stock valued at $8,606,000 after purchasing an additional 3,967 shares in the last quarter. Jane Street Group LLC lifted its position in shares of McGrath RentCorp by 2,213.6% in the 1st quarter. Jane Street Group LLC now owns 58,140 shares of the financial services provider's stock worth $6,477,000 after purchasing an additional 55,627 shares during the period. Focus Partners Wealth increased its holdings in McGrath RentCorp by 68.6% during the first quarter. Focus Partners Wealth now owns 2,044 shares of the financial services provider's stock valued at $228,000 after buying an additional 832 shares during the period. Finally, Intech Investment Management LLC raised its stake in McGrath RentCorp by 24.8% in the first quarter. Intech Investment Management LLC now owns 13,800 shares of the financial services provider's stock worth $1,537,000 after buying an additional 2,745 shares in the last quarter. 92.05% of the stock is currently owned by hedge funds and other institutional investors.

About McGrath RentCorp

McGrath RentCorp, through its subsidiaries, provides rental, sales, and servicing of equipment for commercial, industrial, environmental, and residential markets. The company operates primarily through two segments—mobile storage and water management—offering flexible solutions for customers requiring on-site storage, water transport, treatment, and dewatering services.

In its mobile storage segment, McGrath RentCorp supplies portable storage containers and modular office units to sectors including construction, retail, government, and disaster restoration.

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