Investors Sell Hertz Shares Following Q1 Warning

Shares of Hertz Global Holdings Inc HTZ plunged nearly 8 percent early Monday morning after the company provided an update to its outlook. Hertz Global said that it expects its first quarter and full year U.S. car rental revenue and consolidated first quarter earnings per share to be lower than previously expected. The company cited "excess industry capacity" for its poor outlook. Hertz added it expects its first quarter U.S. car rental revenue per available car day to fall 2.5 percent to 3.5 percent compared to the same quarter a year ago. For the full fiscal year, the company expects the same metro to be flat to 1.5 percent lower compared to a prior guidance of 1.5 to 2.5 percent growth year-over-year. Hertz did however affirm its full year fiscal 2016 earnings per share to be in a range of $0.95 to $1.05. The company also reaffirmed its expectation of realizing $350 million of incremental savings in 2016. "We are disappointed that the pricing pressure experienced late in 2015 further intensified in the first quarter of 2016," said President and Chief Executive Officer John Tague. However, we believe that industry capacity will likely moderate as seasonal demand improves establishing the foundation for a relative improvement in pricing as we head into the peak summer season,"