Avis Budget Group (NASDAQ:CAR) Shares Gap Down After Earnings Miss

Key Points

• Avis Budget Group shares fell sharply after the company reported $0.98 in quarterly EPS, well below the $2.05 analyst consensus. Revenue was $3.0 billion, down 1.3% year over year and below the $3.10 billion estimate.
• The stock opened at $150.07 versus a prior close of $166.32 and last traded near $145.06, a decline of roughly 12.7%.
• Analyst sentiment remains cautious, with a consensus “Reduce” rating, an average price target of $132.75, and six Hold and four Sell ratings. Two executive vice presidents also sold 20% of their respective holdings in April.

Avis Budget Group, Inc. (NASDAQ:CAR - Get Free Report)'s share price gapped down prior to trading on Wednesday following a dissappointing earnings announcement. The stock had previously closed at $166.32, but opened at $150.07. Avis Budget Group shares last traded at $145.0590, with a volume of 132,324 shares.

The business services provider reported $0.98 earnings per share for the quarter, missing analysts' consensus estimates of $2.05 by ($1.07). The firm had revenue of $3 billion during the quarter, compared to the consensus estimate of $3.10 billion. Avis Budget Group's revenue for the quarter was down 1.3% compared to the same quarter last year. During the same quarter last year, the company earned $0.10 EPS.

Analyst Upgrades and Downgrades

Several brokerages have recently issued reports on CAR. Deutsche Bank Aktiengesellschaft reiterated a "hold" rating and set a $125.00 price target on shares of Avis Budget Group in a report on Friday, May 1st. Weiss Ratings restated a "sell (d-)" rating on shares of Avis Budget Group in a report on Wednesday, May 20th. Wall Street Zen raised shares of Avis Budget Group from a "sell" rating to a "hold" rating in a research report on Saturday, May 2nd. JPMorgan Chase & Co. lifted their target price on shares of Avis Budget Group from $155.00 to $170.00 and gave the company an "underweight" rating in a research note on Tuesday, June 23rd. Finally, Barclays set a $160.00 target price on shares of Avis Budget Group and gave the stock an "equal weight" rating in a research report on Monday, June 8th. Six equities research analysts have rated the stock with a Hold rating and four have issued a Sell rating to the company's stock. According to data from MarketBeat, Avis Budget Group presently has a consensus rating of "Reduce" and an average price target of $132.75.

Insiders Place Their Bets

In related news, EVP Edward P. Linnen sold 9,483 shares of Avis Budget Group stock in a transaction on Thursday, April 30th. The shares were sold at an average price of $182.32, for a total value of $1,728,940.56. Following the transaction, the executive vice president owned 37,932 shares in the company, valued at $6,915,762.24. This trade represents a 20.00% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this link. Also, EVP Ravi Simhambhatla sold 3,469 shares of Avis Budget Group stock in a transaction on Thursday, April 30th. The stock was sold at an average price of $184.09, for a total transaction of $638,608.21. Following the completion of the transaction, the executive vice president owned 13,876 shares in the company, valued at $2,554,432.84. This trade represents a 20.00% decrease in their position. The SEC filing for this sale provides additional information. 50.48% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Avis Budget Group

A number of hedge funds have recently bought and sold shares of the company. Caitong International Asset Management Co. Ltd increased its stake in shares of Avis Budget Group by 1,845.5% in the fourth quarter. Caitong International Asset Management Co. Ltd now owns 214 shares of the business services provider's stock worth $27,000 after purchasing an additional 203 shares during the period. Quarry LP bought a new stake in Avis Budget Group during the 4th quarter valued at approximately $27,000. Basepoint Wealth LLC bought a new stake in Avis Budget Group during the 4th quarter valued at approximately $32,000. Hollencrest Capital Management acquired a new stake in Avis Budget Group in the 1st quarter valued at approximately $44,000. Finally, Northwestern Mutual Wealth Management Co. grew its holdings in Avis Budget Group by 26.5% in the 3rd quarter. Northwestern Mutual Wealth Management Co. now owns 363 shares of the business services provider's stock valued at $58,000 after buying an additional 76 shares during the last quarter. 96.35% of the stock is currently owned by institutional investors.

Avis Budget Group Trading Down 12.7%

The stock has a fifty day simple moving average of $168.51 and a 200-day simple moving average of $166.97. The stock has a market cap of $5.13 billion, a price-to-earnings ratio of -7.65 and a beta of 1.91.

Avis Budget Group Company Profile

Avis Budget Group, Inc operates as a leading global provider of vehicle rental and mobility solutions. Through its two core brands, Avis® and Budget®, the company offers a broad range of rental options including daily, weekly and monthly car rentals for leisure and business travelers. In addition to traditional airport and off-airport car rental services, Avis Budget Group delivers innovative mobility platforms such as car-sharing programs and connected fleet solutions designed to meet the evolving needs of corporate, government and individual customers.

The company's roots trace back to Avis Rent a Car, founded in 1946, and Budget Rent a Car, established in 1958.

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