Why Avis and Hertz Stocks Fell Tuesday
Shares of rental car companies Avis Budget Group (NASDAQ: CAR) and Hertz Global (NYSE: HTZ) fell as much as 14.3% and 16.4%, respectively, on Tuesday. The declines followed the release of Avis' preliminary fourth-quarter and full-year results, and some somber comments from its management about expectations for 2018.
Investors seem to have extrapolated from Avis' press release that Hertz could be similarly impacted by negative secular trends in 2018.
At the close, Avis and Hertz stock were down 13.5% and 14.9%, respectively.
For 2017, Avis now expects to report total revenue of $8.85 billion, up about 2.2% from 2016. On average, analysts were expecting 2017 revenue of $8.8 billion.
But for 2018, Avis said it expects "ongoing headwinds" to persist, including "the incremental impact of rising interest rates and other items." On a positive note, however, Avis anticipates those headwinds will be partially offset by cost cutting.
While Avis wasn't ready to provide financial guidance for 2018, management said it would do so when it releases its full-year earnings after market close on Feb. 21.
10 stocks we like better than Hertz Global HoldingsWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Hertz Global Holdings wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of January 2, 2018
Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.