CTOS May 21 Boston NDR Invite: Utility T&D Demand, FCF, & Deleveraging

Research evidence excerpt

CTOS May 21 Boston NDR Invite: Utility T&D Demand, FCF, & Deleveraging

May 12, 2026

Company Description

Custom Truck One Source provides equipment rental, leasing, sales, and

services to infrastructure and utility markets (including power transmission

& distribution, telecom, rail, forestry, and waste management) in the U.S.

and Canada. (Source: Cantor Research)

Relevant Research

1. Custom Truck One Source, Inc. (CTOS): CTOS 1Q26/Mgmt. Callback:

Reinforces SER Margin Durability, Pricing Carry-Over, and 2H FCF

Pathway (Published 4/28/2026)

2. Custom Truck One Source, Inc. (CTOS): CTOS 1Q26/First Look: Strong

Quarter, FCF & Deleveraging Story Intact (Published 4/27/2026)

3. Custom Truck One Source, Inc. (CTOS): Initiating on CTOS: From Yard

to Grid; Powering Utility Buildouts (Published 4/21/2026)

Investment Thesis

We see CTOS as a differentiated specialty-equipment and infrastructure platform emerging

from a reset year into a more sustainable period of earnings growth, free cash flow

generation, and deleveraging. The 2025 recovery has already validated the operating

turnaround, with record revenue and a significant improvement in rental fundamentals as

utilization rose to a multi-year high. We believe the core of the story is the rental business,

where stronger T&D demand, data-center-related power investment, and electrification

trends are driving better asset productivity and higher-quality earnings. With backlog and

order activity improving in STEM, inventory returning to normal, and management guiding

to another year of growth in 2026 and levered free cash flow, we believe CTOS is shifting

from an asset-heavy growth phase toward a cash-generating model. As leverage decreases

and market confidence in the durability of the recovery grows, we see potential for both