Wedgewood Partners, an investment management company, released its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, Wedgewood Composite’s net return was -6.3% compared to the Standard & Poor’s -4.3%, the Russell 1000 Growth Index’s -10.0% and the Russell 1000 Value Index’s 2.1% return for the same period. In addition, you can check the fund’s best 5 holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Wedgewood Partners highlighted stocks such as United Rentals, Inc. (NYSE:URI). Headquartered in Stamford, Connecticut, United Rentals, Inc. (NYSE:URI) is an equipment rental company. The one-month return of United Rentals, Inc. (NYSE:URI) was -6.21%, and its shares lost 6.54% of their value over the last 52 weeks. On April 16, 2025, United Rentals, Inc. (NYSE:URI) stock closed at $591.50 per share with a market capitalization of $38.64 billion.

Wedgewood Partners stated the following regarding United Rentals, Inc. (NYSE:URI) in its Q1 2025 investor letter:

During the quarter we initiated a small position in United Rentals, Inc. (NYSE:URI). Given the stock market’s recent burgeoning bear market, we continued to build a position in the stock.

The United Rental’s story is one of simplicity. The Company was founded by entrepreneur Brad Jacob’s in 1997 with a simple mission; create a dominate company with asset and geographic intensity, along with scale and scope, by strategic acquisition in the highly fragmented local industrial rental equipment industry. The Company’s first decade was one of intense acquisition, rolling up over 250 mom-and-pop rental companies. Over the next ten years, the Company had the scale to offer services to national accounts. The success of that original mission continues to bear fruit today because United Rentals has become the industry’s largest competitor, by far, within the industrial rental industry, which today remains quite fragmented. Circa-2025, as one might expect, ecommerce initiatives such as online ordering, mobile apps and online payments, will improve worklows, productivity – and ultimately generate more demand from stickier customers.

Despite nearly 70% of this rental industry still being more fragmented than consolidated, over the past 35-plus years, the Company has amassed a competitively advantaged, highly proitable, geographic size-density similar to that of other of portfolio positions. Think of the structurally advantaged business models of Copart, Old Dominion Freight Line, O’Reilly Automotive and Poolcorp…” (Click here to read the full text)

A construction crew working in the field with earthmoving equipment illuminated by a setting sun.

United Rentals, Inc. (NYSE:URI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 58 hedge fund portfolios held United Rentals, Inc. (NYSE:URI) at the end of the fourth quarter which was 45 in the previous quarter. United Rentals, Inc.’s (NYSE:URI) revenue grew 9.8% year-over-year to almost $4.1 billion. While we acknowledge the potential of United Rentals, Inc. (NYSE:URI) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

We covered United Rentals, Inc. (NYSE:URI) in another article, where we shared Vltava Fund's views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.