Willscot's Debt Reckoning
The bull thesis sours, investors are (metaphorically) begged not to sell, and options are few as the debt comes due.
Key pillars of the bull thesis sold to WSC investors have been battered. Narratives around optional/discretionary CapEx, pricing power, M&A driven growth, and the VAPS revenue opportunity have all soured. Although the scaffolding supporting the growth story is falling, management continues to focus on “returning capital to shareholders” via continued share repurchases and the newly established dividend. In our view, it looks like an unconvincing attempt to maintain a “business as usual” posture as it is unwinding. In the context, it begins to look like begging investors not to sell.
The financial model is broken, the fleet has limited life remaining, and debt is coming due. Will Willscot be rescued?
Before current lenders extend, new lenders lend, or PE firms bid - all investors should review our Willscot lot survey report available HERE. It provides a sample view of the company’s fleet. In our view, one cannot invest in Willscot without developing a full understanding of the fleet - the company’s only means of generating cash.
The Full Report is Available Here:
DISCLAIMER
This report represents the opinions of Keith Dalrymple and Dalrymple Finance on Willscot Mobile Mini. It is an opinion piece and should not be taken as investment advice of any kind. This is not an offer to sell or a solicitation of an offer to buy any security, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.
Willscot Mobile Mini’s webpage provides sell-side firms and analysts that provide research coverage. The firms and analysts listed are in the business of providing investment advice to individual and institutional investors. We strongly encourage those seeking investment advice to consult one or more of the sell-side research firms listed.
The report is based on publicly available information and due diligence Dalrymple Finance believes to be accurate and reliable. However, it is presented “as is” without warranty of any kind, whether express or implied. Dalrymple Finance makes no representation, express or implied, as to the accuracy, timeliness, or completeness of any such information or with regard to the results to be obtained from its use. This report contains a large measure of analysis and opinion. It is subject to change without notice.
Following the publication of this report we intend on continuing to transact in the securities mentioned. We may be long, short or have no position at any time. That position may change at any time.
We are investors with the goal of profiting from our research. You should assume that as of the publication date, that Dalrymple Finance, Keith Dalrymple and/or affiliates have a position in the securities mentioned in this report. We have a vested financial interest in securities discussed in this report.
In no event shall Dalrymple Finance or Keith Dalrymple be liable for any claims, losses costs or damages of any kind, including direct, indirect and otherwise, arising out of or in any way connected with information in this report.