WillScot Holdings Corporation (WSC): A Bear Case Theory

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 bulls’ thesis on WSC. WillScot Holdings Corporation's share was trading at $24.35 as of August 8^th. WSC’s trailing and forward P/E were 41.27 and 20.70, respectively according to Yahoo Finance.

WillScot Mobile Mini (WSC) reported a disappointing 2Q25 with continuing declines in units on rent (UOR), leasing revenues, and EBITDA, alongside sharply rising capital expenditures. The quarter underscored a deteriorating core leasing business despite growth in two niche segments—climate-controlled storage and Clearspan structures—each up 30% year-over-year. However, these bright spots mask a deeper problem: the legacy fleet, which comprises the majority of units, is rapidly eroding and largely outdated, limiting rental demand and revenue potential.

Management’s significant increase in rental equipment depreciation, rising 17% year-over-year despite falling revenues, suggests a strategic accounting shift likely influenced by negotiations with auditors on asset write-downs. This depreciation policy change, combined with the recent departure of the Chief Accounting Officer, signals potential recognition of impaired fleet value. Meanwhile, WSC’s $3.6 billion debt load looms large, with $1.5 billion due in June 2027 and little indication the company can repay lenders with its aging, undervalued inventory. The rental fleet’s decline and escalating CapEx to acquire newer, in-demand units have worsened cash flow and raised doubts about WSC’s financial viability.

Industry commentary and Fitch’s cautious stance hint at growing concern among lenders and analysts. Taken together, these factors paint a picture of a company caught in a slow implosion, reliant on debt-fueled growth amid an increasingly obsolete asset base. Unless the company restructures or reinvents its model, shareholders face the risk of holding nearly worthless equity burdened by substantial debt. WSC’s future remains uncertain, with fundamental challenges casting a long shadow over its prospects.

Previously, we covered a bullish thesis on WillScot Holdings Corporation by BlackOpal Research Limited in March 2025, highlighting strong growth, pricing power, and strategic acquisitions. Since then, the stock has depreciated about 19%, reflecting emerging challenges. Keith Dalrymple shares a contrarian view, emphasizing declining core metrics, rising depreciation, and heavy debt risks.

WillScot Holdings Corporation is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 46 hedge fund portfolios held WSC at the end of the first quarter which was 58 in the previous quarter. While we acknowledge the potential of WSC as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.