We came across a bearish thesis on WillScot Holdings Corporation on DF Research’s Substack by Keith Dalrymple. In this article, we will summarize the bears’ thesis on WSC. WillScot Holdings Corporation’s share was trading at $21.64 as of February 9th. WSC’s trailing and forward P/E were 17.87 and 26.04 respectively according to Yahoo Finance.
WillScot Holdings Corporation provides turnkey temporary space solutions in the United States, Canada, and Mexico. WSC is facing a challenging operating environment that is likely to pressure both 2H25 results and 2026 expectations. Weak non-residential construction spending, evidenced by deteriorating architectural building index readings, suggests continued softness in the modular and storage rental markets.
While large projects such as data centers offer some upside, competitors like United Rentals (URI) are aggressively expanding their specialty equipment businesses, including storage and modular solutions, giving them a competitive edge through broader product offerings and pricing flexibility. Cost pressures further exacerbate the situation, as seen in McGrath Rentals’ 3Q25 report, which highlighted an 18% rise in direct costs against modest revenue growth, suggesting WSC’s margin improvement expectations may be difficult to achieve.
Management’s guidance appears increasingly misaligned with reality. Initial 2025 guidance assumed a stabilizing macro environment, but weak demand and persistent unit-on-rent declines have undermined these assumptions. Consensus EBITDA estimates for 2H25 already appear ambitious, and with declining deployment and pricing trends, WSC’s 2026 outlook is even more concerning.
Leasing revenues, which are dependent on units on rent and pricing spreads, are unlikely to recover in 2026, and previous benefits from favorable pricing have largely dissipated. Current sell-side forecasts for 2026, implying modest EBITDA growth, seem disconnected from these fundamental dynamics and are likely to be substantially revised downward.
Compounding the challenge is the company’s debt situation. Although WSC recently extended its ABL loan to 2030, this does not change the underlying pressure on cash flow generation or debt repayment risk. Taken together, weak demand, rising costs, intensifying competition, and declining leasing trends suggest that WSC faces a difficult operating environment ahead, with limited upside and a high probability of downward revisions to both 2H25 and 2026 estimates, leaving investors with a grim risk/reward profile.
