What to expect from Custom Truck One Source’s (CTOS) Q3 earnings

Heavy equipment distributor Custom Truck One Source (NYSE:CTOS) will be reporting results this Monday after market close. Here’s what to expect.

Custom Truck One Source beat analysts’ revenue expectations last quarter, reporting revenues of $563.4 million, up 10.2% year on year. It was an incredible quarter for the company, with a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.

Is Custom Truck One Source a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting Custom Truck One Source’s revenue to grow 6.8% year on year, in line with the 7.8% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Custom Truck One Source has missed Wall Street’s revenue estimates multiple times over the last two years.

Looking at Custom Truck One Source’s peers in the industrial distributors segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Richardson Electronics delivered year-on-year revenue growth of 18.9%, beating analysts’ expectations by 10.1%, and United Rentals reported revenues up 15.7%, topping estimates by 4.4%. Richardson Electronics’s stock price was unchanged after the resultswhile United Rentals was up 3.3%.

Read our full analysis of Richardson Electronics’s results here and United Rentals’s results here.

In the last year or so, investors have shifted their focus from one macro dynamic to the next (AI disintermediation and AI investment to geopolitical conflict, interest rates, and the health of the wider economy). While some of the industrial distributors stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 6% on average over the last month. Custom Truck One Source is down 4.1% during the same time and is heading into earnings with an average analyst price target of $13.33 (compared to the current share price of $9.06).

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