McGrath RentCorp Q2: Rental Strength Offsets Sales Decline; Guidance Narrowed, Capex Raised
MGRC sits 23% above its 52-week low of $94.99.
Summary
McGrath RentCorp's Q2 2026 revenue fell 6% to $221.1M on lower sales, but rental operations grew 6% with TRS-RenTelco up 17%. Full-year guidance was narrowed and rental capex raised, reflecting confidence in rental demand.
Key Events · Earnings and Guidance · MGRC
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Q2 Revenue Down 6% on Sales Weakness
Total revenues of $221.1M declined 6% YoY, driven by a 34% drop in sales revenue to $46.4M, while rental operations revenue rose 6% to $172.5M.
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TRS-RenTelco Rental Revenue Surges 17%
The electronic test equipment segment posted $31.8M in rental revenue, up 17%, fueled by data center buildout demand and strong market conditions.
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Net Income Declines to $33.7M
Q2 net income of $33.7M ($1.37 diluted EPS) compared to $36.0M ($1.46) a year ago, primarily due to lower gross profit on sales.
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Full-Year Guidance Narrowed, Capex Raised
2026 revenue guidance narrowed to $955M-$985M (from $945M-$995M), Adjusted EBITDA to $363M-$375M (from $360M-$378M), and gross rental capex raised to $200M-$220M (from $180M-$200M).
Analysis · MGRC · Trade & Services
McGrath RentCorp delivered a mixed second quarter. While rental operations grew 6%, powered by a 17% surge in TRS-RenTelco rental revenue tied to data center demand, total revenue fell 6% as sales revenue dropped 34% due to project delays. Net income declined to $33.7M from $36.0M. The company narrowed its full-year revenue and EBITDA guidance ranges and raised its gross rental capex forecast by $20M at the midpoint, signaling confidence in rental demand but also higher investment. The stock yields 1.7% with a $0.495 quarterly dividend. The results show a business in transition — strong rental momentum in key segments is being partially offset by lumpy sales and cost pressures in Portable Storage.
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In the 30 days to Oct 4, 2026, 29.2% of the 1581 measured filings Wiseek scored 7 moved their stock by 5% or more by the next session's close. The median move was -0.60%. These are measured outcomes after filings of this importance, not a forecast for this one.
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At the time of this filing, MGRC was trading at $117.29 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $2.9B. The 52-week trading range was $94.99 to $128.41. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.