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1. Company Snapshot

1.a. Company Description

Hertz Global Holdings, Inc.operates as a vehicle rental company.It operates through two segments, Americas Rental Car and International Rental Car.


The company provides vehicle rental services under the Hertz, Dollar, and Thrifty brands from company-owned, licensee, and franchisee locations in the United States, Africa, Asia, Australia, Canada, the Caribbean, Europe, Latin America, the Middle East, and New Zealand.It also sells vehicles; and operates the Firefly vehicle rental brand and Hertz 24/7 car sharing business in international markets.Hertz Global Holdings, Inc.


was founded in 1918 and is headquartered in Estero, Florida.

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1.b. Last Insights on HTZ

The recent Q4 2024 earnings release of Hertz Global Holdings, Inc. was negatively driven by weak revenue trends, elevated depreciation per unit (DPU), and potential liquidity risks. The company reported a 6.6% year-over-year decline in revenue and EBITDA significantly below expectations due to high DPU. This has led to a sell rating by some analysts, citing the company's inability to capture demand growth, potentially losing market share to competitors like Avis Budget Group. The company's fleet reduction limits its ability to adapt to market changes, further exacerbating the negative drivers.

1.c. Company Highlights

2. Hertz Global Holdings: A Transformative Journey Unfolds

Hertz Global Holdings reported revenue of $2.5 billion and adjusted corporate EBITDA of $190 million for the third quarter of 2025, representing a significant year-over-year improvement of $350 million. The company's earnings per share (EPS) came in at $0.12, beating estimates of -$0.02. The adjusted EBITDA margin was 8%, within the company's guidance. The strong financial performance was driven by a record-high utilization rate of 84% and a sub-$350 DPU goal, achieved through disciplined fleet management and revenue optimization.

Publication Date: Nov -24

📋 Highlights
  • Revenue & EBITDA Growth: Achieved $2.5B revenue and $190M adjusted EBITDA, up $350M YoY with 8% margin.
  • Utilization Record: Reached 84% fleet utilization, highest in over 5 years, driven by operational efficiency.
  • Car Sales Expansion: Revamped car sales as a profit driver, with e-commerce growth positioning as top 5 U.S. used dealers.
  • Liquidity & Cash Flow: Maintained $2.2B liquidity, including $1.1B unrestricted cash and $250M positive free cash flow.
  • Future Targets: Aiming for 3–6% EBITDA margin in 2026 and $1B EBITDA by 2027, backed by disciplined fleet strategy.

Fleet Management and Utilization

The company's focus on fleet management has been a key driver of its success, with a "buy right, hold right, sell right" strategy anchoring fleet unit economics. Utilization reached its highest level in over five years, driven by operational processes that eliminated out-of-service vehicles and idle time, as well as better demand generation. As Wayne West noted, "utilization in the quarter was close to a quarterly record." The company's ability to optimize its fleet has resulted in improved productivity and revenue growth.

Revenue Growth and Pricing

The company's revenue growth was driven by a strong pricing environment globally, with larger RPD and RPU gains in its International segment. The company's commercial strategy focuses on maximizing asset productivity, pricing, and revenue management, with a goal of delivering better customer experiences and growing durable demand. Sandeep Dube highlighted the company's efforts to "deliver a smooth customer experience and leverage technology to make it easier for customers to modify reservations and purchase upgrades digitally."

Valuation and Outlook

With a P/S Ratio of 0.18 and an EV/EBITDA of 19.74, the company's valuation appears reasonable, considering its growth prospects. Analysts estimate revenue growth at 3.6% for next year. The company's focus on building a diverse platform of value-enhancing capabilities, including car sales, service, and mobility, is expected to drive long-term growth. As Scott Haralson noted, "our diversified value-creating platform will give our customers more and position Hertz to thrive across the full spectrum of mobility."

Future Prospects

The company's outlook for 2026 is positive, with expectations of a 3% to 6% EBITDA margin and a target of $1 billion of EBITDA production in 2027. The company's car sales strategy involves trading large volumes of cars annually, with a focus on e-commerce and creating a scale retail sales model. With a strong foundation in place, Hertz is well-positioned to drive growth and create long-term value for its shareholders.

3. NewsRoom

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Dow Climbs Triple Digits Despite Gloomy Jobs Data

Nov -11

Source: schaeffersresearch.com

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Tesla's new plan to get cars out of showrooms takes on Hertz

Nov -11

Source: fastcompany.com

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The Market Loves Hertz Again, But I'm Not So Sure Yet

Nov -05

Source: seekingalpha.com

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Palantir Drops on AI Valuation Concerns; Hertz Soars on Profit Beat | Stock Movers

Nov -04

Source: youtube.com

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Hertz stock jump nearly 40% after returning to profitability

Nov -04

Source: invezz.com

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Bill Ackman's Hertz Stake Is Starting To Look Like His Next Chipotle Moment

Nov -04

Source: benzinga.com

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Hertz Short Squeeze: The New Reddit Stock Play?

Nov -04

Source: benzinga.com

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Hertz Global Holdings, Inc. (HTZ) Q3 2025 Earnings Call Transcript

Nov -04

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.38%)

6. Segments

Americas Rental Car

Expected Growth: 2.5%

Hertz's Americas Rental Car segment growth of 2.5% is driven by increasing demand from leisure travelers, particularly in the US, and a rise in business travel. Additionally, the company's focus on expanding its off-airport locations and investing in digital platforms to enhance customer experience are contributing to growth.

International Rental Car

Expected Growth: 1.8%

Hertz's International Rental Car segment growth of 1.8% is driven by increasing travel demand, particularly in Europe and Asia, where tourism and business travel are on the rise. Additionally, Hertz's strategic partnerships with travel companies and its investment in digital platforms have improved customer experience, leading to higher bookings and revenue growth.

7. Detailed Products

Car Rental

Hertz offers a wide range of vehicles for rent, including economy, compact, intermediate, standard, full-size, premium, and luxury cars, as well as SUVs, vans, and trucks.

Car Sharing

Hertz On Demand is a car sharing service that provides 24/7 access to vehicles for short periods, ideal for errands, meetings, or social events.

Van Rental

Hertz offers a variety of vans, including cargo, passenger, and minivans, suitable for moving, group travel, or commercial use.

Truck Rental

Hertz provides a range of trucks, including pickup trucks, box trucks, and stake trucks, suitable for moving, hauling, or commercial use.

Equipment Rental

Hertz Equipment Rental offers a wide range of equipment, including aerial lifts, generators, and compressors, for construction, industrial, and event applications.

Fleet Management

Hertz provides fleet management services, including vehicle acquisition, maintenance, and disposal, for corporate fleets and government agencies.

8. Hertz Global Holdings, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Hertz faces moderate threat from substitutes, as customers have alternative options for car rentals, such as public transportation, taxis, and ride-hailing services. However, the convenience and flexibility of car rentals make them a preferred choice for many travelers.

Bargaining Power Of Customers

Hertz customers have significant bargaining power due to the presence of multiple car rental companies, allowing them to compare prices and services. Additionally, the rise of online travel agencies and meta-search engines has increased price transparency, further empowering customers.

Bargaining Power Of Suppliers

Hertz has a relatively low dependence on suppliers, as it owns a significant portion of its fleet. Additionally, the company has established relationships with major automotive manufacturers, reducing its reliance on external suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the significant barriers to entry in the car rental industry, including high capital requirements, regulatory hurdles, and the need for a large fleet of vehicles.

Intensity Of Rivalry

The car rental industry is highly competitive, with several major players, including Avis Budget Group, Enterprise Holdings, and Europcar. This intense rivalry leads to competitive pricing, advertising, and service offerings.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 85.22%
Debt Cost 3.95%
Equity Weight 14.78%
Equity Cost 14.77%
WACC 5.54%
Leverage 576.75%

11. Quality Control: Hertz Global Holdings, Inc. passed 0 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Hertz

A-Score: 3.9/10

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Growth: 2.0

Quality: 1.9

Yield: 0.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

5.06$

Current Price

5.06$

Potential

-0.00%

Expected Cash-Flows