Time To Buy The Dip In McGrath RentCorp Stock?
McGrath RentCorp (MGRC) stock has fallen by 11.8% in less than a month, from $119.43 on 6th Feb, 2026 to $105.34 now. Should you buy this dip?
Dip buying is a viable strategy for quality stocks that have a history of recovering from dips. As it turns out, MGRC stock passes basic quality checks. Historically, the median return for the 12-month period following sharp dips was 44% , with median peak return reaching 52%. We define sharp dip as stock going down 20% or more, in less than 30 day period.
Below, we get into details of historical dips and subsequent returns.
Historical Median Returns Post Dips
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| Period | Past Median Return |
|---|---|
| 1M | 4.9% |
| 3M | 10.5% |
| 6M | 19.4% |
| 12M | 44.5% |
Historical Dip-Wise Details
MGRC had 3 events since 1/1/2010 where the dip threshold of -20% within 30 days was triggered
- 52% median peak return within 1 year of dip event
- 350 days is the median time to peak return after a dip event
- -5.2% median max drawdown within 1 year of dip event
| 30 Day Dip | MGRC Subsequent Performance | |||||||
|---|---|---|---|---|---|---|---|---|
| Date | MGRC | SPY | 1Y | Peak Return |
Max Drop |
# Days to Peak |
||
| Median | 44% | 52% | -5% | 350 | ||||
| 3092020 | -29% | -17% | 44% | 52% | -16% | 350 | ||
| 1072016 | -20% | -7% | 70% | 81% | -1% | 349 | ||
| 8032015 | -23% | -0% | 35% | 39% | -5% | 352 | ||
McGrath RentCorp Passes Basic Financial Quality Checks
Revenue growth, profitability, cash flow, and balance sheet strength need to be evaluated to reduce the risk of a dip being the sign of a deteriorating business situation.
| Quality Metrics | Value | Quality Check |
|---|---|---|
| Revenue Growth (LTM) | 3.7% | Pass |
| Revenue Growth (3-Yr Avg) | 14.7% | Pass |
| Operating Cash Flow Margin (LTM) | 27.1% | Pass |
| Leverage (see below) | – | Pass |
| => Interest Coverage Ratio | 8.0 | |
| => Cash To Interest Expense Ratio | 0.0 |
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