William Blair initiated research coverage of WillScot Mobile Mini Holdings Corp. (WSC $48.20), a leading commercial logistics provider of modular and storage solutions.
Analyst Tim Mulrooney estimated that the company will generate more than $1.5 billion in free cash flow over the next three years, with an additional $650 million in available capital assuming a leverage ratio of 3.0 times EBITDA.
“For over six decades, WillScot Mobile Mini has provided customers with temporary space solutions, including mobile office trailers, portable classrooms, modular complexes, panelized units, and portable storage containers,” said Mulrooney. “With a large fleet and an extensive branch network, the company can quickly accommodate shifting local demand and large-scale projects in a way that local and regional competitors cannot. Furthermore, WillScot’s offering of value-added products and services across its fleet considerably increases the functionality of its units and reduces the time required to render the units operational. Other modular space providers do not offer this suite of products, owing to the complexity of managing an extensive product offering and the significant investment required to build out this type of solution.
“WillScot is the largest supplier of both modular space and portable storage units across North America, with a combined fleet of more than 350,000 units, excluding U.K. storage, and a branch network with over 240 locations,” continued Mulrooney. “Combining its extensive branch network and best-in-class offering, WillScot is the premier provider of modular space and portable storage space in North America and its market-leading size allows it to offer customers a differentiated value proposition focused on reliability and convenience. Through its unmatched value proposition, the company has been able to capture significant market share and generate outsized rental rate increases.”
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Current Ratings Distribution (as of 2/8/23)
Coverage Universe
Outperform (Buy): 73%
Market Perform (Hold): 27%
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Market Perform (Hold): 3%
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