BofA analyst John Babcock lowered the firm’s price target on Hertz (HTZ) to $2.50 from $3 and keeps an Underperform rating on the shares. BofA expects it could take a few years for rental car earnings to normalize with a persistently wide gap between new and used vehicle pricing driving elevated vehicle depreciation and macro risks that could feed into rental car volumes and pricing, so it has adjusted its valuation methodology and now values Avis Budget (CAR) and Hertz based on its normalized EBITDA estimates, noting that it had previously valued the stocks on 2025 EBITDA. The firm’s $155 price target on Avis is unchanged and it keeps a Buy rating on its shares.
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