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Avis Budget Group Inc. Analyst Roundup

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David B. Wyshner, CFO of Avis Budget Group Inc. (NASDAQ: CAR) commented that the high-end of his company's $860 to $910 million full year 2014 EBITDA “looks challenging right now.” The stock fell on the news along with concerns over vehicle residual values.

JP Morgan - Overweight

“We are updating our estimates following CAR’s announcement yesterday that its North American FY14 fleet cost would come in “slightly higher” than expected, and given the lower than expected European operating trends in the 3Q. With fleet residual values now in focus, we believe this is more of an immediate term, transitory issue that will be righted by year-end as CAR (and the industry) defleet following the peak 3Q demand and fleet period.”

Deutsche Bank - Hold, $60 Price Target

“We believe the stock could remain relatively range-bound as investors are likely to wait for incremental clues on the near-term direction of residual values and hear CAR’s updated thoughts on its 3Q earnings call.”

MKM Partners - Buy, $80 Price Target

“With the stock 15% off its highs, we believe the market strongly overreacted to the update. We reiterate our Buy rating. (1) Europe was a bigger culprit of the disappointment, in our view. (2) Fleet costs are likely only a couple of dollars above the high-end of previous guidance range; we believe this a reasonable margin of error given the unprecedented vehicle recalls over the summer. (3) Pricing was a major highlight in the quarter and encourages us on trends into 2015. (4) We believe the market paid too little attention to its pipeline of three bolt-on acquisitions which tend to be highly accretive given the multiples typically paid and the synergy opportunities.”

Avis Budget Group Inc. traded at $53.32 late Wednesday, down 2.8 percent.

Latest Ratings for CAR

DateFirmActionFromTo
Feb 2017Credit SuisseDowngradesOutperformNeutral
Oct 2016Goldman SachsInitiates Coverage OnNeutral
Sep 2016BarclaysMaintainsEqual-Weight

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Posted-In: Deutsche Bank JP Morgan MKM PartnersAnalyst Color Analyst Ratings

 

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