Hertz extends slump as BofA joins bear camp, analysts slash PTs
Corrects record low in 2nd bullet to $4.35, not $4.42
** Hertz's HTZ.O shares down 2.4% at $4.57 on Fri as BofA Global Research downgrades to "underperform" from "neutral" in wake of rental car firm's bleak report
** HTZ on Thurs slumped 19.3% to close at $4.68, after hitting record low of $4.35, after co posted wider-than-expected Q1 loss and said now plans to sell additional 10,000 EVs, taking total planned sales to 30,000 this year
** BofA slashes PT to $3 from $9, saying higher fleet costs unlikely to subside meaningfully in near-term
** Liquidity also an increasing concern among investors, BofA adds, pointing to co's older fleet that needs to be refreshed amid sizable declines in used vehicle prices
** Jefferies maintains "hold", cuts PT to $5 from $8
** While underlying demand environment remains stable and HTZ's new CEO (Gil West) reaffirmed cost-cutting initiatives, Jefferies views 2024 and early 2025 as "challenging given high vehicle DPU (depreciation per unit) and the realistic timeline to rightsize its fleet, including EVs"
** JP Morgan cut its PT to $7 from $11, keeps "neutral" rating
** Now, 7 of 9 analysts rate HTZ "hold" and 2 rate "sell", per LSEG; median PT of $5.50 down from $9.50 a month ago
** With move on the session, stock down 56% YTD. Shares well below the Nov 2021 "re-IPO" price of $29, following co's emergence from bankruptcy in late Jun that year
(Lance Tupper is a Reuters market analyst. The views expressed are his own)
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