Deutsche Bank Called Hertz Spike 2 Days Ago

Shares of car rental company Hertz Global Holdings Inc HTZ are surging 13 percent in early trading on Friday following the company’s restatement of more than two years of financial results. The company’s 10k filing provided some clarity to the market, and many investors seem to think that the ailing company is now back on track.

The filing
According to the 10k filing, the company misstated $207 million in pretax income from 2011 to 2013. The revisions reduced pretax income during that time by up to 23 percent.

The positive reaction in the market seems to indicate that there were fears that the adjustments could be much worse, or perhaps the market is cheering the $300 million in annualized cost savings that the company is now projecting to reach by the end of the year.

MKM’s take
MKM Partners analyst Christopher Agnew released a report on Friday outlining MKM’s take on the filing. “Restatements were broadly in line and 2014 and 1Q15 were ahead of our expectations and within the previous indicated range,” Agnew explains.

Now that Hertz has put its past missteps behind it, MKM believes that it’s safe for investors to step in. MKM has a Buy rating on Hertz and a $28 target for the stock.

Deutsche Bank’s good timing
Deutsche Bank analyst Chris Woronka earned himself a pat on the back this week when it comes to Hertz. On Wednesday, Deutsche Bank upgraded Hertz from Hold to Buy. “While there may be limited truly incremental information in the filings… we believe having the restatements complete could make the stock investible to a wider audience of investors,” Woronka wrote just one day before the filing.

Deutsche Bank now has a $24 target on Hertz.