Opinions
Brian Acker, CA
Avis Budget Group
CAR-Q
DON'T BUY
Mar 14, 2023
N/A
Stock price when the opinion was issued
Consumer Products
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COMMENT
Avis bought out Avis Europe at the beginning of the 4th quarter and basically took a write off. Has recovered very strongly from the great recession. There is a little bit of growth in the number of cars being rented. 1st and 4th quarters are their worst quarters but they make money in the summer. Margins are being squeezed by competition and people unwilling to pay.
Consumer Products
BUY ON WEAKNESS
All the rental car companies are extremely volatile. They tend to be small. A lot of the spending that goes there is very cyclical. No one has to rent a car. They are also up against Uber. However, the companies are cheap and just crying out for consolidation. On pullbacks, he would add to positions.
Consumer Products
Used cars took off two years ago, and this got caught up in meme trading. Their PE is way off the charts, and used car prices are declining. We also face a recession if not now then next quarter.