Avis Budget Targets Cut At Credit Suisse, Pricing 'Not Firing On All Cylinders'

In a report published Thursday, Credit Suisse analyst Anjaneya Singh maintained an Outperform rating on Avis Budget Group Inc. CAR,while reducing the price target from $65 to $62, after meeting the company's senior management team. Management indicated that pricing was trending positively month-on-month, from April's lows. However, pricing continued to be under pressure, particularly since the June price increase initiated by Hertz Global Holdings Inc HTZ was ineffective. "It seems that HTZ's increase was not uniform across all brands (perhaps due to ongoing operational woes), and Enterprise did not follow suit," analyst Anjaneya Singh said. In the report Credit Suisse noted, "CAR is seeing healthy summer reservations in Europe, with some countries up double digits by volume. While pricing remains pressured in the region, management believes that the dynamic could improve once Europcar goes public. In the Americas, there have been volume declines in the oil patch in Canada, but CAR has done a good job managing fleet levels to maintain flattish utilization." There has been no impact from ride sharing services in any of the company's businesses or customer segments. The EPS estimate for 2015 has been reduced to $3.49 from $3.52, to reflect more conservative pricing assumptions.