Avis slides as BofA double downgrades on valuation
20/08/2025 15:25
** Shares of rental car firm Avis Budget Group CAR.O down 5% to $148.74 on Weds as BofA Global Research downgrades to 'underperform' from 'buy', citing valuation ** Brokerage reduces PT by $7 to $113, ~28% below stock's last close ** CAR fundamentals and macro environment don't support current stock price which significantly outperformed the market in June, BofA writes in note ** Rental industry facing pricing and demand pressures in the U.S. which negatively impacts CAR's earnings power in second half of this year and 2026, BofA says ** BofA says its survey indicates that fewer consumers expect to spend more on travel in the next three months compared to 2024, and should translate to a soft pricing environment ** Meanwhile, shares of rival Hertz Global Holdings HTZ.O are rising ~10% on the session after announcing partnership with Amazon.com's AMZN.O auto retail platform to sell used vehicles online ** Of 9 brokerages covering CAR, recommendation breakdown is 3 "strong buy" or "buy", 4 "hold" and 2 "sell" ratings, per LSEG ** Median PT of $150 up from $115 a month ago ** With move on Weds, CAR shares up 84% YTD, including ~39% rally in June. The Dow Jones Transport Avg .DJT is off 1% in 2025 (Lance Tupper is a Reuters market analyst. The views expressed are his own) ((lance.tupper@tr.com 1-646-279-6380))