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1. Company Snapshot

1.a. Company Description

Custom Truck One Source, Inc.provides specialty equipment rental services to the electric utility transmission and distribution, telecommunications, rail, other infrastructure-related industries in North America.It operates through Equipment Rental Solutions, Truck and Equipment Sales, and Aftermarket Parts and Services segments.


The Equipment Rental Solutions owns new and used specialty equipment, including truck-mounted aerial lifts, cranes, service trucks, dump trucks, trailers, digger derricks, and other machinery and equipment.The Truck and Equipment Sales segment offers new equipment for sale to be used for end-markets which can be modified to meet customers specific needs.The Aftermarket Parts and Services segment provides truck and equipment maintenance and repair services as well as sale of specialized aftermarket parts.


The company was formerly known as Nesco Holdings, Inc.and changed its name to Custom Truck One Source, Inc.in April 2021.


Custom Truck One Source, Inc.was founded in 1988 and is headquartered in Kansas City, Missouri.

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1.b. Last Insights on CTOS

Custom Truck One Source, Inc. has made significant strides in recent months. The company's unveiling of advanced equipment at Utility Expo 2025, including the Outback Series, showcases its commitment to innovation and customer-focused solutions. Additionally, its Q3 earnings call highlighted key metrics, with a quarterly loss of $0.03 per share, in line with expectations. Notably, Private Capital's recent 13F filing revealed strategic moves, potentially indicating increased investor confidence. The company's focus on expanding its product offerings and enhancing its presence in the utility, infrastructure, and construction industries is evident.

1.c. Company Highlights

2. Custom Truck One Source Shines in Q3 2025 with Strong EBITDA Growth

Custom Truck One Source Inc. reported a robust third quarter in 2025, with adjusted EBITDA growth of 20% and revenue growth of 8% compared to Q3 2024. The company's revenue reached $482 million, accompanied by $156 million of adjusted gross profit and $96 million of adjusted EBITDA. Earnings per share (EPS) came in at -$0.03, aligning with analyst estimates. The Equipment Rental Services (ERS) segment saw revenue of $169 million, a 12% increase from Q3 2024, driven by an 18% growth in rental revenue. Average OEC on rent stood at over $1.26 billion, up 17% year-over-year.

Publication Date: Nov -23

📋 Highlights
  • Strong Q3 Performance:: Adjusted EBITDA rose 20% to $96M, revenue grew 8% to $482M, and adjusted gross profit reached $156M.
  • ERS Segment Growth:: Generated $169M in revenue (12% YoY), with rental revenue up 18% and average OEC on rent reaching $1.26B (+17% YoY).
  • 2025 Guidance Affirmed:: Projects revenue of $1.97B–$2.06B and adjusted EBITDA of $370M–$390M, alongside $250M in rental fleet CapEx and $125M–$150M inventory reduction by 2026.
  • Financial Leverage Reduction:: Net leverage at 4.53x, targeting below 3x by 2026, with $110M–$135M debt reduction expected in Q4 alone.
  • PES Segment Momentum:: Achieved 30% organic growth, driven by utility T&D demand, while data center co-location trends bolster long-term custom truck demand.

Segment Performance and Outlook

The PES segment experienced 30% organic growth, fueled by strong demand in the utility segment, particularly in transmission and distribution (T&D). The backlog currently stands at around $360 million, although it has seen a 25% increase in the first three weeks of October. Intra-quarter order flow is up 30% compared to Q3 2024, indicating a positive trend. The transmission pipeline appears robust, with several large projects underway and more anticipated in early 2026.

Guidance and Capital Allocation

The company reaffirmed its 2025 guidance, with total revenue expected to be between $1.97 billion and $2.06 billion and adjusted EBITDA in the range of $370 million to $390 million. Custom Truck One Source plans to invest approximately $250 million in net rental CapEx and aims to reduce inventory by $125 million to $150 million by the end of 2026. Net leverage stood at 4.53x at the end of Q3, with expectations to reduce it to below 3x by the end of 2026.

Valuation and Growth Prospects

With a P/S Ratio of 0.63 and EV/EBITDA of 2.96, the company's valuation appears reasonable. Analysts estimate revenue growth of 4.9% for the next year. The data center trend of co-locating energy production assets is expected to drive demand for custom trucks, potentially leading to sustained growth. The company's CapEx plan is aimed at supporting this growth, with a focus on maintaining a young fleet age of around 2.9 years.

3. NewsRoom

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Custom Truck One Source, Inc. (CTOS) Presents at Bank of America Leveraged Finance Conference Transcript

Dec -02

Source: seekingalpha.com

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Private Capital's Strategic Moves: Spotlight on Matthews International Corp

Nov -14

Source: gurufocus.com

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Deciphera Announces Multiple Data Presentations at the Connective Tissue Oncology Society (CTOS) Annual Meeting 2025

Nov -12

Source: businesswire.com

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Top Waste Management Stocks To Add to Your Watchlist – October 28th

Oct -30

Source: defenseworld.net

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Why Custom Truck One Source Stock Tanked on Tuesday

Oct -28

Source: fool.com

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Custom Truck One Source, Inc. (CTOS) Q3 2025 Earnings Call Transcript

Oct -28

Source: seekingalpha.com

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Custom Truck One Source (CTOS) Reports Q3 Earnings: What Key Metrics Have to Say

Oct -28

Source: zacks.com

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Custom Truck One Source, Inc. (CTOS) Reports Q3 Loss, Misses Revenue Estimates

Oct -27

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.77%)

6. Segments

Truck and Equipment Sales

Expected Growth: 5%

Custom Truck One Source, Inc.'s 5% growth in Truck and Equipment Sales is driven by increasing demand from infrastructure development projects, rising construction activities, and growing need for specialized equipment in industries such as oil and gas, and mining. Additionally, the company's strategic expansion into new markets and product offerings, as well as its focus on providing customized solutions, contribute to its growth momentum.

Equipment Rental Solutions

Expected Growth: 4%

Custom Truck One Source's Equipment Rental Solutions growth is driven by increasing demand for specialized equipment in infrastructure projects, rising adoption of rental models over ownership, and strategic acquisitions expanding the company's fleet and geographic reach. Additionally, investments in digital platforms and telematics enhance operational efficiency, further fueling growth.

Aftermarket Parts and Services

Expected Growth: 7%

Custom Truck One Source's 7% growth in aftermarket parts and services is driven by increasing demand for specialized truck equipment, expansion into new geographic markets, and strategic partnerships with OEMs. Additionally, the company's investment in digital platforms and e-commerce capabilities has improved customer experience, leading to increased sales and market share gains.

7. Detailed Products

Crane Trucks

Custom Truck One Source offers a range of crane trucks designed for heavy lifting and material handling in various industries such as construction, oil and gas, and utilities.

Aerial Devices

Our aerial devices include aerial lifts, bucket trucks, and digger derricks designed for aerial work, transmission and distribution line construction, and tree trimming.

Telehandlers

Custom Truck One Source offers a range of telehandlers designed for material handling, construction, and industrial applications.

Truck Bodies

Our truck bodies include service bodies, utility bodies, and dump bodies designed for various industries such as construction, utility, and municipal.

Equipment Rentals

Custom Truck One Source offers a range of equipment rentals including aerial devices, crane trucks, and telehandlers for short-term or long-term projects.

Parts and Service

Our parts and service department provides OEM and aftermarket parts, maintenance, and repair services for a range of equipment and trucks.

8. Custom Truck One Source, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Custom Truck One Source, Inc. is medium due to the availability of alternative trucking services and equipment rental options.

Bargaining Power Of Customers

The bargaining power of customers for Custom Truck One Source, Inc. is low due to the company's specialized services and equipment offerings, which limit customers' ability to negotiate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Custom Truck One Source, Inc. is medium due to the presence of multiple suppliers for trucking equipment and services, but the company's large scale of operations gives it some negotiating power.

Threat Of New Entrants

The threat of new entrants for Custom Truck One Source, Inc. is low due to the high capital requirements and regulatory barriers to entry in the trucking industry.

Intensity Of Rivalry

The intensity of rivalry for Custom Truck One Source, Inc. is high due to the competitive nature of the trucking industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 70.23%
Debt Cost 6.85%
Equity Weight 29.77%
Equity Cost 7.35%
WACC 7.00%
Leverage 235.96%

11. Quality Control: Custom Truck One Source, Inc. passed 1 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

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H&E Equipment Services

A-Score: 5.4/10

Value: 3.3

Growth: 6.2

Quality: 5.8

Yield: 3.0

Momentum: 9.5

Volatility: 4.3

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PROG Holdings

A-Score: 4.8/10

Value: 8.3

Growth: 5.8

Quality: 6.9

Yield: 2.0

Momentum: 1.5

Volatility: 4.3

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Custom Truck One Source

A-Score: 4.7/10

Value: 7.2

Growth: 4.3

Quality: 4.0

Yield: 0.0

Momentum: 9.5

Volatility: 3.3

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Willis Lease Finance

A-Score: 4.6/10

Value: 7.8

Growth: 7.6

Quality: 5.0

Yield: 1.0

Momentum: 2.0

Volatility: 4.3

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Hertz

A-Score: 3.9/10

Value: 8.5

Growth: 2.0

Quality: 1.9

Yield: 0.0

Momentum: 9.5

Volatility: 1.3

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FlexShopper

A-Score: 3.0/10

Value: 9.6

Growth: 3.1

Quality: 4.9

Yield: 0.0

Momentum: 0.5

Volatility: 0.0

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

6.11$

Current Price

6.11$

Potential

-0.00%

Expected Cash-Flows