Hertz stock sinks toward a record low, after profit tops expectations while revenue was in line

Shares of Hertz Global Holdings Inc. (HTZ) slumped 3.3% toward a record low in premarket trading Thursday, after the car rental company topped profit expectations while revenue was in line and margins were flat. Net income was $629 million, or 92 cents a share, compared with $577 million, or $1.33 a share, in the year-ago period, as the number of shares used in calculating per-share results dropped 13.7% to 327 million shares. Excluding nonrecurring items, adjusted EPS of 70 cents was above the FactSet consensus of 68 cents. Revenue grew 8.3% to a record $2.70 billion, in line with the FactSet consensus. The rise in revenue was driven by "continued strength in demand, particularly in leisure and rideshare channels, coupled with pricing that was well above pre-pandemic levels." Net income margin of 23% was the same as last year. The stock, which was on track to open at the lowest price seen since it started trading on July 1, 2021, after Hertz emerged from bankruptcy. It has plunged 43.6% over the past three months through Wednesday while rival Avis Budget Group Inc. shares (CAR) have dropped 25.6% and the S&P 500 has lost 8.3%.

-Tomi Kilgore

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10-26-23 0744ET

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