WillScot Mobile Mini Holdings Corp. (WSC) is a North American company providing modular space and portable storage solutions. The company leases turnkey office space and storage solutions for temporary applications across a diverse customer base in the commercial and industrial, construction, retail, education, health care, government, transportation, security, and energy sectors.
WSC is the one provider in an industry experiencing robust demand. Due to strong performance in the first quarter, the company raised its full-year 2021 guidance for revenue, adjusted EBITDA, and net capex.
While the company only had $27 million in cash as of the most recent quarter, its short-term debt was only $17 million. However, the company has a negative profit margin. In terms of sales, the company has grown revenue an average of 38.3% over the past three years. Analysts expect sales to rise 68.4% year over year this quarter.
The stock does appear overvalued with a forward P/E of 33.9 and price-to-sales ratio of 3.8. While the stock was showing positive momentum since last July, performance has been mixed since April as evident in the chart below.
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Take a look at the 1-year chart of WSC below with my added notations:
Chart of WSC provided by TradingView
WSC has formed key support at $27.50 (green) over the past couple of months. In addition, the stock is also declining against a down trending resistance line (red). These two lines have WSC stuck within a common pattern known as a descending triangle.
Eventually, the stock will break out of this pattern. A short trade could be made on a break of the support level. A long trade could be made on a break through the resistance trendline.
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WSC shares rose $0.21 (+0.74%) in premarket trading Wednesday. Year-to-date, WSC has gained 24.00%, versus a 15.02% rise in the benchmark S&P 500 index during the same period.
About the Author: Christian Tharp
I am an expert stock market coach having helped over 4000 beginner and advanced traders & investors from around the world take control of their financial futures. I also write stock market related articles for the Adam Mesh Trading Group and Yolo Publishing. More...
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