Stock under Consideration: H&E Equipment Services Inc. (NASDAQ: HEES)

BATON ROUGE, La., June 22, 2019 – Shares of H&E Equipment Services Inc. (NASDAQ: HEES) declined -0.49% to $28.26. The stock traded total volume of 182.684K shares lower than the average volume of 223.90K shares.

H&E Equipment Services Inc. (HEES) recently reported first-quarter net income of $14.20M.

FINANCIAL NEGOTIATION FOR FIRST QUARTER 2019

Revenue:

Total revenues increased 20.4% to $313.60M in the first quarter of 2019 from $260.50M in the first quarter of 2018. Total equipment rental revenues increased 22.9% to $176.10M contrast with $143.30M in the first quarter of 2018 (as adjusted). Rental revenues (as formerly stated) increased 23.4% to $159.70M contrast with $129.40M in the first quarter of 2018. New equipment sales increased 27.1% to $59.10M from $46.50M a year ago. Used equipment sales increased 19.2% to $29.60M contrast to $24.90M a year ago. Parts sales increased 8.1% to $30.40M from $28.20M in the first quarter of 2018. Service revenues increased 3.5% to $15.60M contrast to $15.00M a year ago.

Gross Profit:

Gross profit increased 22.8% to $113.70M from $92.60M in the first quarter of 2018. Gross margin was 36.3% for the quarter ended March 31, 2019, as contrast to 35.5% for the quarter ended March 31, 2018. On a segment basis, gross margin on total equipment rentals was 44.3% in the first quarter of 2019 contrast to 43.2% in the first quarter of 2018 (as adjusted). Rental margins (as formerly stated) were 48.7% in the first quarter of 2019 contrast to 47.6% last year. On average, rental rates were 2.3% higher than rates in the first quarter of 2018. Time utilization (based on original equipment cost) was 70.0% in the first quarter of 2019 contrast to 70.4% a year ago.

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Rental Fleet:

At the end of the first quarter of 2019, the original acquisition cost of the Company’s rental fleet was $1.90B, a boost of $351.10M from the end of the first quarter of 2018. Dollar utilization for the first quarter of 2019 was 35.2% contrast to 34.7% for the first quarter of 2018.

Selling, General and Administrative Expenses:

SG&A expenses for the first quarter of 2019 were $78.60M contrast with $65.90M the prior year, a $12.80M, or 19.4%, increase. SG&A expenses in the first quarter of 2019 as a percentage of total revenues were 25.1% contrast to 25.3% a year ago. Employee salaries, wages, payroll taxes and related employee benefit and other employee related expenses increased $7.90M, mainly as a result of our acquisitions since March 31, 2018, and a larger workforce and higher incentive compensation related to increased profitability. Legal and professional fees increased $0.70M. Facility related expenses mainly rent expense; increased $1.40M and liability insurance costs increased $0.80M. Depreciation and amortization increased $0.70M. Expenses related to Greenfield branch expansions increased $0.70M contrast to a year ago.

Income from Operations:

Income from operations for the first quarter of 2019 increased 30.6% to $35.70M, or 11.4% of revenues, contrast to $27.30M, or 10.5% of revenues, a year ago.

Interest Expense:

Interest expense was $16.90M for the first quarter of 2019 contrast to $14.70M a year ago.

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Net Income:

Net income was $14.20M, or $0.40 per diluted share, in the first quarter of 2019 contrast to net income of $9.50M, or $0.26 per diluted share, in the first quarter of 2018. The effective income tax rate was 26.4% in the first quarter of 2019 and 27.5% in the first quarter of 2018.

Adjusted EBITDA:

Adjusted EBITDA for the first quarter of 2019 increased 24.7% to $100.90M contrast to $80.90M in the first quarter of 2018. Adjusted EBITDA as a percentage of revenues was 32.2% contrast with 31.1% in the first quarter of 2018.

HEES has the market capitalization of $1.03B and its EPS growth ratio for the past five years was 11.20%. The return on assets ratio of the Company was 4.50% while its return on investment ratio stands at 10.10%. Price to sales ratio was 0.79 while 74.70% of the stock was owned by institutional investors.

Richard McEntire

Finance and Entertainment Reporter Richard is a bottle of wine - the older the sweeter. He has already found the sweetest hobby in writing entertainment and finance news for Own Snap. Readers get the updated posts regularly from him searching for real-time news.

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