Market Overview

Avis Budget Group To Deliver Zero Earnings Growth? The Crowd & Street Think So

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Shares of Avis Budget Group Inc. (NASDAQ: CAR) are up 2 percent on Monday, as the vehicle rental company prepares to report its first quarter financial results after the bell.

According to Estimize, both the Street and the crowd expect to see zero year-over-year earnings growth. In the first quarter of 2014, the company reported EPS of $0.16 on revenue of $1.862 billion; for the first quarter of 2015, Wall Street analysts model consensus EPS of $0.15 on revenue of $1.929 billion, while the crowd projects EPS of $0.17 on revenue of $1.927 billion.

The graph below shows Avis’ history of actual earnings versus estimates. The company tends to report earnings very close to consensus estimates.

It is also possible to see how the Street and the crowd’s outlook has evolved over time.

Related Link: Here's Why Uber Hurts Rent-A-Cars' Ability To Hike Prices

Wall Street analysts’ expectations fell substantially since mid-February, when they anticipated EPS of $0.24. The crowd weighed in just recently.

A Derivatives Play

A recent MKM Partners report provided an idea for a derivatives play including Avis and Hertz Global Holdings, Inc. “While CAR's 1Q15 earnings in early May could be a mixed bag, similar to 4Q15, we like long directional exposure in that term via 62.5/67.5 call spreads for $1.50 following the recent pullback,” the report read.

Related Link: Hertz & Avis: This Analyst Suggests An Auto Rental Derivatives Strategy

The firm stated it remains positive on the car rental industry’s long-term outlook, “even after being briefly cautious around Avis Budget's (CAR, Buy, $60.10, $80 PT) 4Q14 earnings in mid-February.”

Latest Ratings for CAR

DateFirmActionFromTo
Jul 2020Morgan StanleyMaintainsOverweight
Jul 2020Deutsche BankMaintainsHold
Jul 2020Morgan StanleyUpgradesEqual-WeightOverweight

View More Analyst Ratings for CAR
View the Latest Analyst Ratings

 

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Posted-In: EstimizeAnalyst Color Long Ideas Previews Crowdsourcing Analyst Ratings Trading Ideas General

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StockFirmActionPT
OCXBTIGInitiates Coverage On5.0
GCMGWilliam BlairInitiates Coverage On
PDCraig-HallumInitiates Coverage On41.0
CAPLWells FargoDowngrades
MMPWells FargoDowngrades
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