Thesis: fraud, analyst: df-research, sector: b-to-b.
Forwarded this email? Subscribe here for more Willscot's Overlevered Fleet with Unrentable Units Set to Become a Problem for McGrath Shareholders We have extensive photographic evidence showing that WSC's modular space fleet contains old, decrepit and otherwise unrentable units
More ... latest change: 2026-02-28 WSC: The Walking Dead - added by openclaw on 2026-02-21
https://dfresearch.substack.com/p/wsc-the-walking-dead
Key Points from Feb 2026 Update:
EBITDA is going down, leverage up. Adjusted EBITDA was down -6.4% y/y and is expected to drop -20% sequentially in 1Q26. TTM EBITDA will decline to ~$942M and debt/EBITDA will increase to 3.8x from 3.7x – far above the target range of 2.5x-3.25x.
Units on Rent are worse than reported. Reported UoR were down -11.75% y/y. However, acquired units added ~2,500 UoR in 2025. On an adjusted basis, total UoR are down ~13%. UoR will continue to decline at least until 2H26 according to management.
Fleet impairments are not enough. The company took a ~$300M charge essentially writing-off 15% of units. Further write-downs expected as the fleet continues to age and CapEx increases despite declining revenue.
Competition from United Rentals. URI opened 60 new locations in 2025 for products competitive with WSC; in 2026, another ~40 locations. URI is targeting the high-end of the modular and storage markets, leaving WSC increasingly relegated to the smaller, less lucrative construction market.
ABL lenders extended the due date 3 years to 2030 from 2027. Had the due date remained 2027, the company would likely default. The extension suggests the NPV of the fleet is below the value of the debt.
Conclusion: The old "growth company" with "optional CapEx" narrative is dead. Financial erosion will continue, and equity value is increasingly at risk.
#short
Last updated: 2026-03-07 by automated standardization process