Why RB Global's Turnaround Could Finally Stick In 2026

Core Viewpoint - RB Global is experiencing a turnaround with improved market conditions, positioning 2026 as a pivotal year for growth following the IAA acquisition [1][2] Near-Term Headwinds and 2026 Growth Outlook - Recent challenges such as limited catastrophic events and softness in repairable claims may impact near-term performance, but 2026 is expected to mark a return to steady growth for RB Global [2] - The brokerage anticipates gross transaction value (GTV) to shift from flat levels in 2024-2025 to mid-single-digit growth in 2026, with further improvements into 2027 as the Commercial, Construction & Transportation (CC&T) sector recovers and the auto segment gains market share [3] Operational Performance - RB Global is positioned to become a consistent double-digit EBITDA compounder, supported by strong free cash flow and reduced cyclicality through operational leverage and disciplined execution [4] Salvage Business Fundamentals - The fundamentals of RB's salvage business remain robust, with rising repair costs and increasing vehicle complexity differentiating it from the general used-car market [5] - While tighter household budgets may lead some consumers to forgo minor repairs, significant accidents will still drive vehicles into the salvage channel [5] Auto and Commercial Segment Growth Drivers - The auto vertical, accounting for approximately 54% of GTV, is viewed as a key growth driver, with the integration of IAA expected to help regain lost market share from competitor Copart [6] - The legacy CC&T segment, which makes up about 34% of GTV, has faced downturns but is projected to stabilize in 2026 due to increased truck bankruptcies and rising capital expenditures from rental operators [7] Financial Projections - Bank of America has adjusted its earnings per share (EPS) projections for RB Global, estimating $3.71 for 2025, $4.30 for 2026, and $4.80 for 2027 [7] - Revenue forecasts have also been revised, with 2025 revenue expected at $4.54 billion, 2026 at $4.87 billion, and 2027 at $5.29 billion [8] - The price forecast of $120 is based on a valuation of 17.5x 2025E EV/EBITDA, aligning with peers in the industrial services sector [8]