Willscot Mobile Mini Holdings Corp A (WSC)

The solvency analysis of Willscot Mobile Mini Holdings Corp A, based on the provided ratios, indicates a distinctive financial position characterized by minimal or nonexistent leverage through debt. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio are all consistently reported at zero across the years from December 31, 2020, through December 31, 2024. This suggests that the company has not, during this period, utilized debt financing significantly, or possibly at all, resulting in a debt-free capital structure.

Conversely, the financial leverage ratio exhibits a progressive increase over the same period, moving from 2.60 in 2020 to 5.92 in 2024. This ratio measures the extent to which the company employs borrowed funds to finance its assets relative to equity. The rising trend implies that, despite the absence of reported debt ratios, the company’s use of leverage—likely through other financial strategies or off-balance-sheet arrangements—has become more prominent or efficient over time.

In summary, these ratios collectively depict a company that maintains an essentially debt-free profile in terms of traditional solvency metrics, while simultaneously increasing its leverage as reflected in the escalating financial leverage ratio. This pattern may suggest a reliance on internal funds or alternative financial structures rather than traditional borrowing to support its operations, growth, or asset base.

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Coverage ratios

The interest coverage ratio of Willscot Mobile Mini Holdings Corp A demonstrates a fluctuating trend over the period from December 31, 2020, to December 31, 2024. As of December 31, 2020, the ratio stood at 1.12, indicating that the company's earnings before interest and taxes (EBIT) were barely sufficient to cover its interest expenses, signaling a relatively tight financial position in terms of interest obligations.

By December 31, 2021, the ratio increased substantially to 2.20, reflecting an improvement in the company's ability to meet its interest payments, with earnings more than doubling relative to prior year's interest obligations. This trend continued into 2022, where the ratio further increased to 3.47, suggesting a strong capacity to service interest expenses and indicating a period of financial strengthening.

However, the ratio experienced a slight decline in 2023 to 3.34, maintaining a level indicative of satisfactory coverage but signaling a marginal reduction in earnings relative to interest obligations compared to 2022. The most recent data point for December 31, 2024, shows a notable decrease to 1.25, which signifies a return closer to the lower end of the spectrum, and indicates the company's EBIT is only marginally above its interest expenses. This diminished ratio may suggest increased financial strain or potential cash flow pressures in covering interest commitments.

Overall, the trend illustrates an initial period of improving interest coverage from early 2020 through 2022, followed by a decline in 2023 and 2024. The recent ratio approaching 1.25 warrants careful examination, as it indicates the company is operating with a relatively narrow margin of safety to cover interest expenses, which could pose risks if earnings decline further or if interest rates increase.