Piper Jaffray, in partnership with Rental Equipment Register, released results from April’s Rental Sentiment Survey, demonstrating an upward trend in the construction equipment rental industry. The Rental Sentiment Index for the month of April registered 6.4, its highest level since Nov 2013.
Piper Jaffray partners with Rental Equipment Register (RER) to publish its monthly Rental Sentiment Survey. The Rental Sentiment Survey gauges the outlook of the construction equipment rental industry by polling industry executives for their expectations on rental revenues, rates, volumes, utilization, capital expenditures and the general outlook for the rental industry.
The results of this month’s survey demonstrate that the industry has a continued positive outlook on the rental market. April’s survey showed a marked improvement of 60 percent of respondents indicating that their outlook was slightly or significantly improved, up notably from last month's 49 percent.
A 6.4 reading signals modest-to-moderate rental expansion, which industry experts consider to be the optimal growth environment for equipment rental companies because it encourages the ongoing secular penetration of rentals and mitigates against over-investment in the rental fleet.
“The spring thaw has ushered in healthy demand for equipment rentals and has increased overall sentiment on the full year outlook for the industry,” according to survey results. Survey respondents note that rates and utilization are "continuing to rise," leading to a "good outlook for the summer."
The responses were based on what is indicated to be an "upward trend in rental volume" with "high concentration in aerial and excavation equipment."
April's Rental Sentiment Survey had 86 participants. Respondents represent construction equipment rental companies with annual revenues ranging from less than $1 million to more than $200 million.
Approximately 40 percent of survey participants are affiliated with companies with more than $10 million in annual revenues, placing them among the 100 largest rental companies in North America.
