Financial Data and Key Metrics Changes - Custom Truck One Source, Inc. generated $521 million in revenue for Q4 2024, with adjusted gross profit of $168 million and adjusted EBITDA of $102 million [26] - Average utilization of the rental fleet for Q4 was just under 79%, compared to 73% in Q3 and under 78% in Q4 of the prior year [27] - Total OEC (Original Equipment Cost) in the rental fleet ended the year at $1.52 billion, up $60 million versus year-end 2023 and up $22 million versus the end of Q3 [31] Business Line Data and Key Metrics Changes - The ERS segment had $172 million of revenue in Q4, down from $185 million in Q4 of 2023, but rental revenue was up 15% sequentially [28] - TES segment revenue for Q4 was over $308 million, a quarterly record, and total TES revenue for the year exceeded $1 billion for the first time, up almost 7% versus 2023 [15][32] - APS business posted revenue of $41 million in Q4, up more than 6% from Q4 of the previous year [35] Market Data and Key Metrics Changes - Approximately 55% of total revenue comes from the utility end market, which is experiencing significant growth due to increased electricity demand driven by AI and grid upgrades [10] - Net orders improved in Q4 to $280 million, up over 90% on a sequential basis and up 35% compared to Q4 of 2023 [34] - The company expects total revenue for 2025 to be between $1.97 billion and $2.06 billion, with projected adjusted EBITDA between $370 million and $390 million [22][39] Company Strategy and Development Direction - The company plans to continue investing in its rental fleet and expanding its physical presence, including opening a new branch in Portland, Oregon [14][24] - Management emphasized the importance of long-term relationships with strategic suppliers and a diversified customer base as key to success [23] - The company aims to achieve a net leverage ratio below three times by fiscal 2026, with a target to get below four times by the end of fiscal 2025 [40][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term demand drivers in the industry, despite some demand weakness experienced in certain utility markets [41] - The company anticipates double-digit adjusted EBITDA growth across its consolidated business in 2025, driven by strong market tailwinds [25][41] - Management noted that high interest rates and economic caution influenced customer purchasing behavior, but they are closely monitoring order intake [17] Other Important Information - The company closed on a sale-leaseback transaction on eight properties for net proceeds of over $52 million, which were used to reduce borrowings [21] - Inventory management efforts resulted in a reduction of more than $150 million in Q4, contributing to lower balances on floor plan lines and reduced borrowings [37] - The company is monitoring developments involving tariffs and chassis emission regulations, with approximately 30% of total purchases coming from Mexico and Canada [19][20] Q&A Session Summary Question: Concerns about TES Revenue guidance and backlog - Management explained that the normalized backlog is four to six months and emphasized the increase in net orders as a positive indicator for revenue growth [45][46] Question: Seasonality of revenue and EBITDA - Management expects a similar split of revenue and EBITDA between the first and second halves of the year, with slight variations [52][54] Question: Impact of sale-leaseback on lease expenses - Management clarified that the sale-leaseback will result in an incremental lease expense of approximately $4.5 to $5 million annually, primarily affecting cost of goods sold [56] Question: Margin outlook and tariff impacts - Management provided insights on margin targets, indicating low to mid-seventy percent margins for rental and mid-teens for TES, while also discussing strategies to mitigate tariff impacts [65][69] Question: Infrastructure bill benefits - Management noted that benefits from the infrastructure bill are still emerging and described the current situation as mid-innings in terms of impact [74] Question: Utilization progression in the full year guide - Management indicated that utilization is expected to remain in the high seventies to low eighties range, driven by strong demand from utility customers [78][82]

分组1 - Custom Truck One Source, Inc. (CTOS) reported quarterly earnings of $0.04 per share, matching the Zacks Consensus Estimate, but down from $0.07 per share a year ago [1] - The company posted revenues of $520.74 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 4.80% and slightly down from $521.75 million year-over-year [2] - Custom Truck One Source shares have declined approximately 13.9% since the beginning of the year, contrasting with the S&P 500's decline of -0.5% [3] 分组2 - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The estimate revisions trend for Custom Truck One Source is currently favorable, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is -$0.04 on revenues of $421.56 million, and for the current fiscal year, it is -$0.04 on revenues of $1.87 billion [7] 分组3 - The Automotive - Original Equipment industry, to which Custom Truck One Source belongs, is currently ranked in the bottom 40% of over 250 Zacks industries, which may negatively impact stock performance [8]

Company Overview - Custom Truck One Source operates one of the largest specialty rental equipment fleets in North America, with over 10,000 units and an average unit age of approximately 3.2 years[21]. - The company serves more than 8,000 customers, with the top 15 customers representing approximately 17% of total revenue, and no single customer exceeding 3% of total revenue in 2024[61]. - The company operates more than 40 locations across North America, with over 2,600 third-party service partners, enhancing its ability to provide local service and support[59]. - The company has a strong focus on enhancing its aftermarket parts and services, leveraging its service technicians to support both rental and customer-owned equipment[66]. - The company operates from its headquarters in Kansas City, Missouri, and maintains over 39 equipment rental and service locations across the U.S. and Canada[166]. Financial Performance - Total revenue for the year ended December 31, 2024, was $1,802.3 million, a decrease of 3.4% compared to $1,865.1 million in 2023[206]. - Rental revenue decreased by 7.5% to $442.9 million in 2024 from $478.9 million in 2023, primarily due to lower rental asset sales and supply chain constraints[206]. - Equipment sales revenue was $1,223.0 million, down 2.4% from $1,253.5 million in 2023, reflecting a decrease in sales volume[206]. - Gross profit decreased by 14.1% to $390.3 million in 2024, compared to $454.3 million in 2023[206]. - Operating income fell to $126.4 million in 2024, down from $170.9 million in 2023, a decrease of 26.1%[206]. - Net loss for the year was $28.7 million, compared to a net income of $50.7 million in 2023, representing a decline of $79.4 million[206]. Market and Industry Trends - The Infrastructure Investment and Jobs Act includes approximately $1.2 trillion in spending, positively impacting Custom Truck's end-markets, with less than 50% of the funds allocated as of November 2024[27]. - Capital expenditures in the electric utility T&D end-market are estimated to be approximately $95 billion in 2024, driven by the need for grid resiliency and renewable energy investments[28]. - The telecommunications infrastructure spending was approximately $95 billion in 2023, expected to grow due to the BEAD program and the expansion of wireless 5G technology[38]. - Total infrastructure capex spend in the U.S. in 2024 is estimated to be just over $300 billion, projected to increase to just under $350 billion by 2028[45]. - The municipal solid waste revenue in the U.S. is projected to grow at a CAGR of 4.7% from 2024 to 2030, driven by increasing waste generation per capita[46]. Operational Challenges - The company has experienced near-term pressure in demand in the utility market due to a lack of customer access to financing in a tight credit environment[120]. - Disruptions in supply chains, including semiconductor shortages and transportation delays, could significantly impact the company's ability to meet customer demand and generate revenue[116]. - The company faces risks related to supply chain disruptions, which could adversely affect its ability to manufacture and market products[101]. - Approximately 2% of the U.S. hourly workers are represented by a labor union, which poses risks of work stoppages and could impact production stability[107]. Strategic Initiatives - The company has identified several new product categories for expansion, focusing on electric utility T&D, telecom, infrastructure, rail, forestry, and waste management, which are increasing capital expenditures[65]. - The company plans to invest in its rental fleet to meet growing demand, particularly in the electric utility T&D and telecom industries[64]. - The company has launched an e-commerce platform to sell proprietary Load King™ equipment parts and other specialty equipment parts[66]. - The company maintains a diverse geographic footprint and has successfully opened five locations in new markets without relying solely on acquisitions[68]. Employee and Community Engagement - As of December 31, 2024, the company had approximately 2,619 employees across more than 40 locations in North America, with about 2% of U.S. employees covered by a collective bargaining agreement[78]. - In 2024, the company provided 26 paid internship opportunities to students from vocational high schools and university programs, aiming to attract early-career talent[86]. - The company has a network of approximately 100 Safety Ambassadors to promote workplace safety and engage employees in safety awareness[91]. - The company offers a comprehensive benefits program, including medical, vision, dental, life, and disability insurance, along with a 401(k) savings program with company matching[92]. - The company is committed to community giving, partnering with nonprofit organizations to support local communities through financial donations, volunteer time, and in-kind support[94]. Risk Factors - The company faces significant operating and financial restrictions that may limit its ability to capitalize on business opportunities[138]. - Compliance with evolving cybersecurity regulations may incur substantial expenses and require changes in business practices[145]. - The company is subject to complex environmental and safety regulations that could adversely affect operational costs and feasibility[147]. - Climate change may disrupt operations and require additional expenditures, impacting financial condition and results[149]. - Increased scrutiny on ESG initiatives could lead to higher compliance costs and affect the company's reputation[152]. Debt and Financial Obligations - As of December 31, 2024, the company's total indebtedness was $1,547.7 million, including $920.0 million in 2029 Secured Notes and $582.9 million under the Asset Based Lending Facility[132]. - The company has $1,384.2 million in variable rate debt under the ABL Facility and floor plan financing arrangements as of December 31, 2024[139]. - A one-eighth percentage point increase in interest rates would increase interest expense by approximately $1.7 million per year[139]. - The ABL Facility has a borrowing base that is subject to fluctuations based on the valuation of parts inventory, fleet inventory, accounts receivable, and unrestricted cash[137]. ESG and Cybersecurity - The company published its inaugural ESG report in 2023 and may engage in additional voluntary ESG initiatives, which could incur significant costs[153]. - The company has invested in cybersecurity safeguards and maintains a cybersecurity risk management program to protect its IT systems[158]. - The company has not identified any known cybersecurity threats that have materially affected its operations or financial condition, but ongoing risks remain[160]. - The company has committed to certain ESG initiatives, but achieving these commitments may be hindered by factors beyond its control, potentially harming its reputation and investor relations[154]. - Unfavorable ESG ratings could negatively impact investor sentiment and the company's share price, as well as its access to capital[155].

Revenue Performance - Total quarterly revenue reached $520.7 million, an increase of $73.5 million or 16.4% compared to the third quarter of 2024[5] - Full-year revenue was $1.802 billion, a decrease of 3.4% compared to 2023[5] - Total revenue for the twelve months ended December 31, 2024, was $1,802,280, a decrease of 3.4% compared to $1,865,100 for the same period in 2023[31] - Total revenue for Q4 2024 was $520.7 million, slightly down from $521.8 million in Q4 2023[45] Net Income and Loss - Quarterly net income was $27.6 million, compared to a net loss of $17.4 million for the third quarter of 2024[5] - Full-year net loss was $28.7 million compared to a net income of $50.7 million in 2023[5] - Net income for the twelve months ended December 31, 2024, was a loss of $28,655 compared to a net income of $50,712 in 2023[31] - Net income for Q4 2024 was $27.6 million, up from $16.1 million in Q4 2023, primarily due to a gain on a sale leaseback transaction[18] Adjusted EBITDA - Adjusted EBITDA for the fourth quarter was $102.0 million, an increase of $21.8 million or 27.2% compared to the third quarter of 2024[5] - Adjusted EBITDA for Q4 2024 was $102.0 million, a sequential increase of $21.8 million (27.2%), but a decrease of $16.3 million (13.8%) compared to Q4 2023[19] - Adjusted EBITDA decreased to $339,657,000 in 2024 from $426,930,000 in 2023, a decline of approximately 20.4%[49] Revenue by Segment - TES segment revenue exceeded $300 million for the quarter and $1 billion for the year, up more than 16% sequentially[3] - TES segment revenue increased by $47.8 million (18.4%) sequentially to $307.7 million, with a 2.9% increase compared to Q4 2023[15] - APS segment revenue rose by $4.1 million (11.3%) sequentially to $40.6 million, and increased by $2.4 million (6.2%) compared to Q4 2023[16] - The 2025 revenue outlook by segment includes ERS at $660 million to $690 million, TES at $1,160 million to $1,210 million, and APS at $150 million to $160 million[22] Debt and Leverage - As of December 31, 2024, total debt outstanding was $1,547.7 million, with a net leverage ratio of 4.5 times[20] - The net leverage ratio increased to 4.55 as of December 31, 2024, compared to 3.53 in 2023, indicating a significant rise in leverage[49] - Net Debt as of December 31, 2024, was calculated as total debt minus cash and cash equivalents, providing a clearer picture of the company's financial position[39] - Long-term debt, net, rose to $1,519,882,000 in 2024, up from $1,487,136,000 in 2023, indicating an increase of approximately 2.2%[48] Cash Flow and Assets - The company reported a net cash flow from operating activities of $121,985 for the twelve months ended December 31, 2024, compared to a negative cash flow of $30,883 in 2023[33] - Total assets increased to $3,501,967 as of December 31, 2024, compared to $3,367,797 as of December 31, 2023, representing a growth of 4.0%[32] - Cash and cash equivalents decreased to $3,805 as of December 31, 2024, from $10,309 as of December 31, 2023[33] Inventory and Backlog - Inventory declined by more than $150 million in the fourth quarter, positioning the company well for 2025[3] - The company experienced a 46.4% reduction in backlog to $368.8 million compared to Q4 2023, attributed to improved supply chain conditions[15] Other Financial Metrics - Adjusted Gross Profit for Q4 2024 was $167.6 million, down from $171.1 million in Q4 2023[45] - Adjusted Gross Profit from rentals for Q4 2024 was $92.6 million, compared to $88.4 million in Q4 2023, showing an increase of 2.5%[47] - The company recognized a gain of $23.5 million from a sale leaseback transaction involving 8 properties with a net book value of $29.0 million[42]

Core Insights - The article emphasizes the importance of value investing as a successful strategy across various market conditions, focusing on fundamental analysis and traditional valuation metrics to identify undervalued stocks [2] Company Analysis - Custom Truck One Source (CTOS) has a Zacks Rank of 2 (Buy) and a Value grade of A, indicating strong potential for value investors [3] - CTOS has a PEG ratio of 0.76, significantly lower than the industry average of 1.54, suggesting it may be undervalued relative to its expected earnings growth [4] - The P/B ratio for CTOS is 1.33, which is favorable compared to the industry average of 3.43, indicating a solid market value relative to its book value [5] - The Shyft Group (SHYF) also holds a Zacks Rank of 2 (Buy) and a Value grade of A, with a P/B ratio of 1.56, again lower than the industry average [6] - Both CTOS and SHYF are highlighted as likely undervalued stocks, supported by their strong earnings outlooks [7]

Group 1: Company Overview - Custom Truck One Source, Inc. (CTOS) is part of the Auto-Tires-Trucks sector, which includes 100 individual stocks and currently holds a Zacks Sector Rank of 15 [2] - CTOS has a Zacks Rank of 2 (Buy), indicating a favorable outlook based on earnings estimate revisions and improving earnings outlooks [3] Group 2: Performance Metrics - The Zacks Consensus Estimate for CTOS' full-year earnings has increased by 4.8% over the past quarter, reflecting stronger analyst sentiment and an improving earnings outlook [4] - CTOS has returned 8.1% year-to-date, outperforming the average loss of 1.9% in the Auto-Tires-Trucks sector [4] - In the Automotive - Original Equipment industry, which includes 50 companies, CTOS is performing better than the average gain of 1.8% so far this year [6] Group 3: Comparative Analysis - Another stock in the Auto-Tires-Trucks sector that has outperformed is Garrett Motion (GTX), which is up 6.3% year-to-date and also holds a Zacks Rank of 2 (Buy) [5] - Both CTOS and Garrett Motion are positioned well within their respective industries, suggesting potential for continued solid performance [7]

Company Performance - Custom Truck One Source Inc (CTOS) is showing signs of recovery after three consecutive quarters of declines in both revenue and profitability [1] - The company demonstrated similar potential for growth a year ago, but demand subsequently weakened [1] Analyst Background - Robert F Abbott has managed his family's investment accounts since 1995 and incorporated options trading strategies in 2010 [1] - The analyst holds a Bachelor of Arts degree and a Master of Business Administration (MBA) [1] - Abbott operates a website providing investment information for mutual fund investors at beginner and intermediate levels [1]

Core Viewpoint - The article emphasizes the importance of value investing and highlights Custom Truck One Source (CTOS) as a strong candidate for value investors due to its favorable financial metrics and Zacks Rank [2][3][7] Financial Metrics - CTOS has a PEG ratio of 0.76, which is significantly lower than the industry average of 1.59, indicating potential undervaluation [4] - The stock's P/B ratio stands at 1.29, compared to the industry's average of 1.92, suggesting an attractive valuation relative to its book value [5] - CTOS's P/S ratio is 0.62, which is slightly below the industry average of 0.63, reinforcing the notion of the stock being undervalued [6] Investment Outlook - The combination of CTOS's strong earnings outlook and its favorable valuation metrics positions it as an impressive value stock at the moment [7]

Core Insights - Long-term follow-up data from the Phase 3 DeFi trial of nirogacestat in adults with progressing desmoid tumors indicate further reductions in tumor size, increased objective response rate (ORR), and sustained improvement in symptoms, with a median treatment duration of approximately 3 years [1][2][3] Efficacy and Safety - The long-term treatment with nirogacestat resulted in an ORR of 45.7%, with 34.3% achieving partial responses (PRs) and 11.4% achieving complete responses (CRs) [4] - The median best percent reduction in target tumor size was −32.3% at year one and −75.8% for patients completing at least four years of treatment [4] - Patient-reported outcomes (PROs) showed early and sustained improvements in pain and physical functioning, with significant benefits reported by patients [5][6] Clinical Trial Details - The DeFi trial involved 142 patients, with 70 receiving nirogacestat and 72 receiving placebo, focusing on progression-free survival (PFS) as the primary endpoint [8] - The ongoing open-label extension phase allows for continued assessment of nirogacestat's efficacy and safety beyond the double-blind portion of the study [8] Subgroup Analysis - A post-hoc analysis indicated that nirogacestat treatment led to consistent improvements in PFS, ORR, and PROs across various subgroups with poor prognostic factors [6] - The ORR risk difference between nirogacestat and placebo ranged from 18.1% to 56.0%, favoring nirogacestat [6] Patient Population Insights - Desmoid tumors are rare, aggressive tumors primarily affecting individuals aged 20 to 44, with a higher prevalence in females [9] - The estimated annual incidence of new cases in the U.S. is between 1,000 and 1,650 [9] Company Overview - SpringWorks Therapeutics is focused on developing treatments for severe rare diseases and cancer, with OGSIVEO (nirogacestat) being its first FDA-approved therapy for desmoid tumors [10][16] - The company is also exploring nirogacestat for other indications, including ovarian granulosa cell tumors and multiple myeloma [11]

Custom Truck One Source 3rd Quarter 2024 Investor Presentation October 30, 2024 CONFIDENTIAL DRAFT1 2 Safe Harbor This presentation includes certain financial measures that have not been prepared in a manner that complies with generally accepted accounting principles in the United States ("GAAP"), including, without limitation, Adjusted Gross Profit, Adjusted Gross Margin, EBITDA, Adjusted EBITDA and Pro Forma Adjusted EBITDA (collectively, the "non-GAAP financial measures"). These non-GAAP financial measur ...