Avis Budget Group Inc. (CAR) Testing Investors’ Patience Right Now

GLBE Stock
GLBE Stock

SRS Investment Management LLC recently announced the acquisition of new stake in Avis Budget Group Inc. (NASDAQ:CAR). The institutional investor has increased its shareholding in the Industrials company by 4.44% to 17.43 million shares with purchase of 0.74 million shares. This fresh investment now brings its stake to 25.02% valued currently at $451.43 million. In addition, Nomura Securities Co., Ltd. (Priv.. raised its holdings by 1.25 million to 5.09 million shares. And Melvin Capital Management LP has lifted its position by 15.94% or 0.55 million shares – to 4.0 million shares.

With over 1.91 million Avis Budget Group Inc. (CAR) shares trading Tuesday and a closing price of $35.31 on the day, the dollar volume was approximately $67.55 million. The shares have shown a positive weekly performance of 4.19% and its price on 09/01/20 gained nearly 3.52%. Currently, there are 69.60M common shares owned by the public and among those 68.42M shares have been available to trade.

An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 7 analysts who have offered their price forecasts for CAR have a consensus price objective of $36.83. The analysts have set the share’s price value over the next 12 months at a high of $60.00 and a low of $26.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Avis Budget Group Inc. stock is 2.30 for the next 12 months. The average price target is 9.46% above its last price level and an upside to the estimated low will see the stock lose -35.81% over that period. But an upside of 41.15% will see the stock hit the forecast high price target while mean target price for the stock is $33.50.

Insiders at the company have transacted a total of 68 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 46 of these insider trades were purchases, accounting for 1,855,890 shares. Insider sales of the common stock occurred on 22 occasions, with total insider shares sold totaling 112,315 shares.

The top 3 mutual fund holders in Avis Budget Group Inc. are Vanguard Selected Value Fund, Vanguard Total Stock Market Index, and iShares Core S&P Mid Cap ETF. Vanguard Selected Value Fund owns 1.61 million shares of the company’s stock, all valued at over $41.67 million. The company sold -0.57 million shares recently to bring their total holdings to about 2.31% of the shares outstanding. Vanguard Total Stock Market Index sold 1061.0 shares to see its total holdings shrink to 1.49 million shares valued at over $38.68 million and representing 2.14% of the shares outstanding. iShares Core S&P Mid Cap ETF sold 2736.0 shares to bring its total holdings to over 1.43 million shares at a value of $36.98 million. iShares Core S&P Mid Cap ETF now owns shares totaling to 2.05% of the shares outstanding.

Shares of Avis Budget Group Inc. (NASDAQ: CAR) opened at $33.76, down -$0.35 from a prior closing price of $34.11. However, the script later closed the day at $35.31, up 3.52%. The company’s stock has a 5-day price change of 4.19% and 29.82% over the past three months. CAR shares are trading 9.52% year to date (YTD), with the 12-month market performance up to 45.55% higher. It has a 12-month low price of $6.35 and touched a high of $52.98 over the same period. Currently, 1.91 million shares have been traded, compared to an average intraday trading volume of 4.58 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by 11.82%, 23.61%, and 33.80% respectively.

Institutional ownership of Avis Budget Group Inc. (NASDAQ: CAR) shares accounts for 98.40% of the company’s 69.60M shares outstanding. Mutual fund holders own 28.89%, while other institutional holders and individual stakeholders account for 70.58% and 28.76% respectively.

It has a market capitalization of $2.38B and a beta (3y monthly) value of 2.53. The earnings-per-share (ttm) stands at -$4.67. Price movements for the stock have been influenced by the stock’s volatility, which stands at 4.50% over the week and 5.65% over the month.

Analysts forecast that Avis Budget Group Inc. (CAR) will achieve an EPS of $0.03 for the current quarter, -$0.77 for the next quarter and $1.24 for 2021. The lowest estimate earnings-per-share for the quarter is -$0.57 while analysts give the company a high EPS estimate of $0.41. Comparatively, EPS for the current quarter was $2.96 a year ago. Earnings per share for the fiscal year are expected to increase by 93.70%, and 115.80% over the next financial year. EPS should shrink at an annualized rate of -7.70% over the next five years, compared to 12.40% over the past 5-year period.

If you are looking to buy this stock, then you may note that the average analyst recommendation by 7 brokerage firm advisors rate Avis Budget Group Inc. (CAR) as a “Moderate Buy” at a consensus score of 2.30. Specifically, 3 Wall Street analysts polled rate the stock as a buy, while 4 of the 7 advise that investors “hold,” and 0 rated it as a “Sell.”

Looking at the support for the CAR, a number of firms have released research notes about the stock. Morgan Stanley stated their Overweight rating for the stock in a research note on July 02, 2020, with the firm’s price target at $37. Morgan Stanley coverage for the Avis Budget Group Inc. (CAR) stock in a research note released on May 21, 2020 offered a Equal-Weight rating with a price target of $15. JP Morgan was of a view on April 23, 2020 that the stock is Neutral, while Consumer Edge Research gave the stock Equal Weight rating on March 27, 2020, issuing a price target of $20. Northcoast on their part issued Neutral rating on February 21, 2020.


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