Executives at NESCO Holdings LP recently sold a large amount of shares in Custom Truck One Source, Inc. (NYSE:CTOS) for a total consideration of over $8 million. The transaction took place on September 5, 2024 and was disclosed in a regulatory filing with the SEC.
The shares were sold at a weighted average price of $3.42, with individual sale prices ranging from $3.42 to $3.72. The total number of shares disposed by the executives was 2,354,109 shares, for aggregate sale proceeds of approximately $8,051,052.
Executives at Custom Truck One Source, Inc., known for its equipment rental and leasing services, have been actively buying and selling their own stock. Recent filings suggest a significant offering is underway, but a footnote in the SEC filing said the detailed number of shares sold at each price point within the range is available upon request.
Following these transactions, NESCO Holdings LP and its affiliates will continue to be the majority holders of Custom Truck One Source shares. Specifically, ECP Cardinal Holdings, LP and NESCO Holdings, LP hold 4,088,426 shares and 19,296,453 shares, respectively.
As detailed in the footnotes to our SEC filings, our complex structure of ownership and control involves multiple entities and managers. ECP ControlCo, LLC, which is overseen by our board of directors, is connected to NESCO Holdings LP and ECP Cardinal Holdings, LP through a series of partnerships and holdings. The managers collectively share the voting and disposition power of the securities and may further be deemed to have shared beneficial ownership of our reported shares.
The transaction was approved by executives of NESCO Holdings and ECP Cardinal Holdings, demonstrating coordinated action between the companies involved.
Investors and analysts often scrutinize insider trading to gauge executives’ sentiment about the company’s future prospects. The stock sales by Nesco Holdings executives are open to various interpretations, but the filing did not provide specific reasons for the sales.
For further details and complete information regarding the number of shares sold at each price within the reported range, interested parties are directed to contact the issuer or the SEC as instructed in the filing.
In other recent news, Custom Truck One Source saw significant financial changes. The company’s EBITDA came in below expectations at $80.1 million and full-year guidance was revised downward. Despite these challenges, revenue and adjusted EBITDA grew sequentially. The company also increased its credit facility from $750 million to $950 million, providing it with increased financial flexibility for its operations and strategic initiatives.
Financial services firm Baird adjusted its outlook for Custom Truck One Source, lowering its price target to $6.00 from $7.00 previously, but maintaining an outperform rating. The change is due to a decline in backlog levels in the Truck and Equipment Sales (TES) division, but Baird continues to have a positive outlook on the company.
In other company news, Energy Capital Partners director nominee Rahman D’Argenio has resigned from the company, reducing the size of the board from 11 to 10. Meanwhile, Oppenheimer and DA Davidson adjusted their target price for Custom Truck One Source due to the recent earnings release and challenges in the transmission business.
These are some recent developments for Custom Truck One Source: The company remains optimistic about the future, forecasting improvement in the second half of the year and focusing on generating positive free cash flow in 2024.
InvestingPro Insights
Amidst the recent insider trading for Custom Truck One Source, Inc. (NYSE:CTOS), the company’s financial position and market performance paint a broader picture for investors. According to InvestingPro data, CTOS’s current market capitalization is around $807.84 million, reflecting its size within the industry. However, the company’s P/E ratio is negative 60.62, indicating investor concerns about profitability. Moreover, the company’s revenue growth has been sluggish, growing at just 2.11% over the trailing 12 months of Q2 2024.
Analysts with InvestingPro point out several key factors that could be influencing investor sentiment. Notably, CTOS is operating with a lot of debt and, as one InvestingPro tip indicates, management has been aggressively buying back shares. This share repurchase activity could be a sign of management’s confidence in the company’s future or an attempt to support the stock price. Meanwhile, another tip notes that the Relative Strength Index (RSI) suggests the stock is currently in oversold territory, which could pique the interest of value-seeking investors.
Investors considering CTOS should note that the company’s share price has declined significantly, trading near its 52-week low and dropping significantly over the past three months. Additionally, analysts have lowered their revenue estimates for the upcoming period, with a decline in full-year net income expected. For those interested in learning more about the company’s performance and future prospects, InvestingPro offers additional insights, with 13 more InvestingPro tips on CTOS available at https://www.investing.com/pro/CTOS.
It is important for investors to consider these factors, along with insider trading activity, to form a comprehensive view of Custom Truck One Source’s current state and likely future trends.
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