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1. Company Snapshot

1.a. Company Description

Ashtead Group plc, together with its subsidiaries, engages in the construction, industrial, and general equipment rental business in the United States, the United Kingdom, and Canada.It provides pumps, power generation, heating, cooling, scaffolding, traffic management, temporary flooring, trench shoring, and lifting services.The company offers its products and services for facilities maintenance and municipalities, such as office complexes, apartment complexes, government, hospitals, data centers, parks and recreation departments, schools and universities, shopping centers, pavement/kerb repairs, and golf course maintenance; construction of airports, highways and bridges, office buildings, data centers, schools and universities, shopping centers, residential, remodeling, manufacturing plants, and green energy plants; emergency response for fire, hurricanes, flooding, tornadoes, winter, storms, residential and health emergencies, alternative care facilities, points of distribution, and mobile testing facilities; and entertainment and special events, including national events, concerts, sporting events, film and telvision production, theme parks, festivals farmers' markets, local 5k runs, and cycle races.


It operates 967 stores in the United States, 89 stores in Canada, and 177 stores in the United Kingdom under the Sunbelt Rentals brand.The company was founded in 1947 and is headquartered in London, the United Kingdom.

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1.b. Last Insights on AHT

Ashtead Group's recent performance was negatively impacted by a 3.4% year-over-year decline in revenue to $2.57 billion in Q3 2025, missing estimates. The company's earnings per share (EPS) also fell short of expectations, coming in at $0.71 compared to $0.76 in Q3 2024. Despite strong rental revenue growth, flat total revenues and a decline in revenue led to a disappointing earnings report.

1.c. Company Highlights

2. Ashtead Group plc Delivers Robust Financial Performance with Strategic Progress

Ashtead Group plc reported a strong financial performance in its full-year and Q4 2025 results, driven by record rental revenues and EBITDA growth. Group rental revenue grew 4% year-over-year, reaching $5.9 billion, with North America and the UK contributing significantly to the growth. Adjusted EBITDA reached $5 billion, a 3% increase, while pre-tax profit stood at $2.1 billion, translating to earnings per share (EPS) of $3.70. The company also demonstrated strong cash generation, with operating cash flow of $5 billion and near-record free cash flow of $1.8 billion. Alex Pease highlighted the company's disciplined capital allocation, noting, "We generated nearly $1.8 billion in free cash flow and executed a $1.5 billion buyback, demonstrating our confidence in growth and cash flow resilience."

Publication Date: Jun -19

📋 Highlights
  • Record Financial Performance: Ashtead Group reported $5 billion in EBITDA, a 3% increase, with pre-tax profit of $2.1 billion and $3.70 earnings per share.
  • Sunbelt 4.0 Strategy Success: Added 42,000 new customers, generating $1.9 billion in rental revenue growth, with operational improvements reducing costs by 25%-40%.
  • Strong Cash Generation: Delivered $1.8 billion in near-record free cash flow, with $2.4 billion invested in capital expenditures and $886 million returned to shareholders.
  • Rental Revenue Growth: North America rental revenue grew 4%, with Specialty segments up 8% and UK rental revenue up 5%, supported by market expansion and operational efficiency.
  • Future Guidance and Initiatives: Fiscal 2026 guidance includes 0-4% rental revenue growth, $1.8-$2.2 billion in capital expenditure, and continued focus on strategic initiatives like NYSE relisting and M&A activities.

Operational Improvements and Strategic Initiatives

The company made significant progress under its Sunbelt 4.0 strategy, adding 42,000 new customers and generating $1.9 billion in rental revenue growth. Operational improvements included the expansion of market-based logistics (MLOs) to 16 markets, reducing pickup times by 25% and third-party hauler costs by 40%. Sustainability initiatives remain on track, aiming to reduce carbon intensity by 50% by 2034. The specialty business saw strong growth, with rental revenue up 8%, while the UK rental revenue grew 5%. However, some segments, like scaffolding, faced headwinds, declining 17%.

Capital Allocation and Future Outlook

Ashtead invested $2.4 billion in capital expenditures, focusing on fleet expansion and greenfield openings. The company remains on track to complete its $1.5 billion buyback program. Guidance for fiscal 2026 includes rental revenue growth of 0-4%, capital expenditure of $1.8-$2.2 billion, and free cash flow of $2.0-$2.3 billion. The relisting project to move the primary listing to the NYSE is expected to be completed in Q1 2026. Management emphasized structural growth opportunities, particularly in non-construction markets, which now account for over half of the business.

Valuation and Investor Takeaways

With a P/E ratio of 17.09 and a free cash flow yield of 5.84%, the stock appears fairly valued given its strong cash generation and growth prospects. The company's ability to deliver consistent free cash flow, coupled with its disciplined capital allocation, positions it well for long-term success. Investors should focus on the company's ability to maintain margin improvements and capitalize on specialty segment growth, which is less capital-intensive but yields higher returns.

3. NewsRoom

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Why The Narrative Around Ashtead Group Is Shifting After Fresh Analyst Updates

Nov -23

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Ashtead Group plc's (LON:AHT) recent 5.8% pullback adds to one-year year losses, institutional owners may take drastic measures

Nov -10

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Is Ashtead Group plc (LON:AHT) Potentially Undervalued?

Oct -27

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Why Analysts Are Rethinking Ashtead Group’s Upside After Latest Market Shifts

Sep -29

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A Look At The Fair Value Of Ashtead Group plc (LON:AHT)

Sep -28

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Why Herc (HRI) Shares Are Sliding Today

Sep -19

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Is Ashtead Group (ASHTY) Stock Outpacing Its Industrial Products Peers This Year?

Sep -18

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Form 8.3 - IQE Plc

Sep -09

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.38%)

6. Segments

US

Expected Growth: 8.5%

Ashtead Group’s equipment rental business for non-residential construction, industrial, and environmental markets in the US is driven by increasing demand for infrastructure development, urbanization, and a growing focus on sustainability, leading to a forecasted CAGR of 8.5%.

UK

Expected Growth: 8.5%

Ashtead's UK segment benefits from increasing demand for equipment rental in construction, industrial, and environmental markets, driven by infrastructure development, urbanization, and growing environmental concerns.

Canada

Expected Growth: 6.5%

Ashtead Group’s Canada segment benefits from increasing infrastructure spending, a growing need for environmental remediation, and a trend towards equipment rental over ownership, driving growth in the construction, industrial, and environmental markets.

7. Detailed Products

Equipment Rental

Ashtead Group plc provides a wide range of equipment for rent to construction, industrial, and non-residential construction markets.

Pump and Dewatering Solutions

Ashtead offers a range of pumps and dewatering solutions for construction, mining, and industrial applications.

Climate Control and HVAC Solutions

Ashtead provides climate control and HVAC solutions for temporary heating, cooling, and ventilation needs.

Power Generation and Distribution

Ashtead offers power generation and distribution solutions for temporary power needs.

Oil-Free Air Solutions

Ashtead provides oil-free air solutions for industrial and construction applications.

8. Ashtead Group plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Ashtead Group plc operates in the equipment rental industry, which has a moderate threat of substitutes. While there are alternative options available, such as buying equipment outright, the convenience and cost-effectiveness of renting equipment make it a preferred choice for many customers.

Bargaining Power Of Customers

Ashtead Group plc has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's equipment rental services are often essential to its customers' operations, giving the company an upper hand in negotiations.

Bargaining Power Of Suppliers

Ashtead Group plc relies on a few large suppliers for its equipment, which gives these suppliers some bargaining power. However, the company's large scale of operations and long-term relationships with suppliers mitigate this power to some extent.

Threat Of New Entrants

The equipment rental industry has high barriers to entry, including significant capital requirements and the need for specialized expertise. This makes it difficult for new entrants to challenge established players like Ashtead Group plc.

Intensity Of Rivalry

The equipment rental industry is highly competitive, with several large players vying for market share. Ashtead Group plc faces intense competition from rivals such as United Rentals and Rentaquip, which can lead to pricing pressure and aggressive marketing tactics.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 59.94%
Debt Cost 5.36%
Equity Weight 40.06%
Equity Cost 10.41%
WACC 7.39%
Leverage 149.62%

11. Quality Control: Ashtead Group plc passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Vinci

A-Score: 6.6/10

Value: 6.3

Growth: 6.2

Quality: 4.6

Yield: 6.9

Momentum: 6.0

Volatility: 9.3

1-Year Total Return ->

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Volvo

A-Score: 6.1/10

Value: 4.7

Growth: 6.4

Quality: 4.4

Yield: 9.4

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

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BAE Systems

A-Score: 5.7/10

Value: 2.4

Growth: 6.9

Quality: 4.8

Yield: 4.4

Momentum: 9.5

Volatility: 6.3

1-Year Total Return ->

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AerCap

A-Score: 5.4/10

Value: 6.4

Growth: 5.2

Quality: 4.8

Yield: 0.6

Momentum: 7.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Saint-Gobain

A-Score: 5.2/10

Value: 4.8

Growth: 5.8

Quality: 4.3

Yield: 4.4

Momentum: 6.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
Ashtead

A-Score: 4.9/10

Value: 4.3

Growth: 7.9

Quality: 6.6

Yield: 1.9

Momentum: 3.0

Volatility: 5.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

47.95$

Current Price

47.95$

Potential

-0.00%

Expected Cash-Flows