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Avis Budget
(NASDAQ:CAR)
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Rating:48Neutral
Price Target:
$112.00
▼(-22.83% Downside)
Action:Reiterated
Date:10/07/26
CAR scores below average primarily due to weak financial performance (TTM revenue drop, net losses, and a highly leveraged/negative-equity balance sheet) and bearish technicals (below key moving averages with negative MACD). Partially offsetting these are improved near-term operational indicators and reiterated EBITDA guidance from the earnings call, plus resilient—though volatile—TTM free cash flow.
Positive Factors
Utilization and operating efficiency
Record utilization alongside deliberate fleet reduction indicates stronger fleet discipline and better asset productivity. This can support margins by increasing revenue generated per vehicle, while conservative fleet sizing may help management match capacity with demand over the next several quarters.
Negative Factors
High leverage and negative equity
High leverage and negative equity leave the company with limited balance-sheet cushion if rental demand, fleet values, or cash generation weaken. Elevated debt also increases interest and refinancing burdens, restricting financial flexibility and making deleveraging a central execution requirement.
Read all positive and negative factors
Positive Factors
Negative Factors
Utilization and operating efficiency
Record utilization alongside deliberate fleet reduction indicates stronger fleet discipline and better asset productivity. This can support margins by increasing revenue generated per vehicle, while conservative fleet sizing may help management match capacity with demand over the next several quarters.
Read all positive factors
Avis Budget (CAR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.74B
Dividend Yield5.19%
Average Volume (3M)416.91K
Price to Earnings (P/E)―
Beta (1Y)1.53
Revenue Growth0.45%
EPS Growth71.43%
CountryUS
Employees21,000
SectorIndustrials
Sector Strength72
IndustryRental & Leasing Services
Share Statistics
EPS (TTM)-18.03
Shares Outstanding35,325,752
10 Day Avg. Volume394,313
30 Day Avg. Volume416,909
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)-1.44
Price to Sales (P/S)0.39
P/FCF Ratio-0.38
Enterprise Value/Market Cap9.08
Enterprise Value/Revenue2.90
Enterprise Value/Gross Profit9.11
Enterprise Value/Ebitda6.14
Forecast
1Y Price Target
$121.67Price Target Upside-16.17% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering6
EPS Forecast (FY)3.08
Revenue Forecast (FY)$11.62B
Avis Budget Business Overview & Revenue Model
Company Description
Avis Budget Group, Inc. is a prominent global provider of diverse mobility solutions, delivering vehicle rental services for both cars and trucks, alongside car-sharing options, to a broad clientele encompassing businesses and individual consumers...
How the Company Makes Money
Avis Budget Group makes money primarily by renting vehicles to customers under its brands (Avis, Budget, and others) across airport and off-airport locations, and by offering car-sharing through Zipcar. Its key revenue streams typically include: (...
Avis Budget Earnings Call Summary
Earnings Call Date:Jul 28, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 03, 2026
Earnings Call Sentiment Positive
The call presented a cautiously positive tone: management highlighted disciplined execution that produced adjusted EBITDA growth, record utilization, RPD stabilization, strengthened liquidity measures, and strategic progress on Waymo and Avis First. At the same time, meaningful near-term headwinds were acknowledged, including softer-than-expected travel demand (notably international), significant recall-related costs and grounded vehicles, elevated leverage and refinancing cost risk, and the potential for used-vehicle price moderation. Management emphasized conservative fleet sizing, operational improvements and capital allocation focused on deleveraging and returns, which supports confidence in guidance but leaves exposure to the noted demand, recall and market risks.Positive Updates
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA grew year-over-year, delivering the highest second-quarter adjusted EBITDA margin in the last 3 years. The company exceeded its first-half adjusted EBITDA plan and reiterated full-year guidance of $850 million to $1 billion.
Negative Updates
Softer Travel Demand and Revenue Pressure
TSA check-ins decelerated during the quarter (from flat in April to -70 bps in May to -1.3% in June). Overseas visitors to the U.S. (CBP I-94) were down ~8% in Q2. Americas revenue declined ~1.9% year-over-year and Americas rental days declined ~2.1% (driven in part by an intentional fleet reduction).
Read all updates
Q2-2026 Updates
Positive
Negative
Adjusted EBITDA Growth and Margin Expansion
Adjusted EBITDA grew year-over-year, delivering the highest second-quarter adjusted EBITDA margin in the last 3 years. The company exceeded its first-half adjusted EBITDA plan and reiterated full-year guidance of $850 million to $1 billion.
Read all positive updates
Company Guidance
Avis reiterated full‑year adjusted EBITDA guidance of $850 million to $1.0 billion and expects to reduce net corporate leverage by at least one full turn of adjusted EBITDA by year‑end 2026 (net corporate leverage was 7.4x as of June 30, down 100 bps since year‑end 2025). Management expects Q3 to resemble Q2 with Americas fleet down roughly mid‑single digits (Americas fleet down ~5–5.4% YoY), rental days down ~2–2.1% (inbound down ~5%), utilization at a record 73.2% in the Americas, RPD broadly flat (RPD ex‑FX +0.2% in Americas; global RPD two consecutive quarters of positive growth), revenue per transaction +6% YoY, and per‑unit depreciation unusually low at $301 (normalized ~$320). Liquidity/funding includes >$1.0 billion available liquidity, ~$1.9 billion fleet funding capacity, a expected $650 million Pentwater settlement (planned to retire the remaining $350 million 2027 notes), a $300 million 2031 note issuance, a revolver extended to June 2031 plus a temporary $200 million facility, and ABS financings of $650 million (AESOP) and $200 million (Canada); recalls have grounded roughly 18,000 vehicles and driven >$50 million of YTD direct costs.Avis Budget Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
12
Very Negative
Cash Flow
46
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 11.71B | 11.65B | 11.79B | 12.01B | 11.99B | 9.31B |
| Gross Profit | 3.73B | 2.85B | 3.00B | 3.93B | 4.77B | 3.39B |
| EBITDA | 5.54B | 4.44B | 2.67B | 6.43B | 7.15B | 4.74B |
| Net Income | -636.00M | -889.00M | -1.82B | 1.63B | 2.76B | 1.28B |
Balance Sheet | ||||||
| Total Assets | 32.33B | 32.19B | 29.95B | 33.42B | 25.93B | 22.60B |
| Cash, Cash Equivalents and Short-Term Investments | 558.00M | 519.00M | 537.00M | 559.00M | 572.00M | 537.00M |
| Total Debt | 29.13B | 31.17B | 26.04B | 26.45B | 20.92B | 17.80B |
| Total Liabilities | 35.55B | 35.24B | 32.27B | 33.76B | 26.63B | 22.81B |
| Stockholders Equity | -3.39B | -3.13B | -2.33B | -349.00M | -703.00M | -220.00M |
Cash Flow | ||||||
| Free Cash Flow | -11.40B | -11.98B | -6.54B | -11.63B | 576.00M | -2.59B |
| Operating Cash Flow | 2.91B | 3.30B | 3.52B | 3.83B | 4.71B | 3.49B |
| Investing Cash Flow | -2.82B | -5.16B | -2.75B | -7.35B | -4.30B | -6.31B |
| Financing Cash Flow | 10.00M | 1.86B | -781.00M | 3.51B | -360.00M | 2.69B |
Avis Budget Technical Analysis
Negative
145.13
Price Trends
127.71
Negative
147.49
Negative
155.51
Negative
Market Momentum
-6.17
Negative
36.04
Neutral
49.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAR, the sentiment is Negative. The current price of 145.13 is above the 20-day moving average (MA) of 110.61, above the 50-day MA of 127.71, and below the 200-day MA of 155.51, indicating a bearish trend. The MACD of -6.17 indicates Negative momentum. The RSI at 36.04 is Neutral, neither overbought nor oversold. The STOCH value of 49.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CAR.
Avis Budget Risk Analysis
Avis Budget disclosed 32 risk factors in its most recent earnings report. Avis Budget reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Avis Budget Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $9.15B | 19.36 | 16.70% | 1.57% | 1.12% | 3.84% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
50 Neutral | $9.93B | 302.05 | 0.60% | 0.25% | 3.02% | -89.75% | |
49 Neutral | $4.13B | 83.99 | 2.56% | 2.27% | 28.50% | 67.75% | |
48 Neutral | $3.74B | -5.88 | 20.63% | 5.19% | 0.45% | 71.43% | |
47 Neutral | $684.39M | -2.16 | 50.96% | ― | 3.39% | 89.28% |
* Industrials Sector Average
CAR
Avis Budget
105.10
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-29.69%
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10.85%
Avis Budget Corporate Events
Business Operations and StrategyFinancial DisclosuresLegal Proceedings
Avis Budget Secures Settlement, Plans Debt Repayment
Positive
Oct 6, 2026
On October 5, 2026, Avis Budget Group, Inc. received a $650 million cash settlement from Pentwater Capital Management LP and affiliated parties, resolving its lawsuit over the recovery of short-swing profits under Section 16(b) of the Securities E...
Business Operations and StrategyPrivate Placements and Financing
Avis Budget Issues New Asset-Backed Fleet Securities
Positive
Sep 24, 2026
On September 21, 2026, Avis Budget’s subsidiary Avis Budget Rental Car Funding (AESOP) LLC issued $650 million in five-year asset-backed securities secured by vehicles in its domestic fleet and related assets. The issuance comprised multiple...
Business Operations and StrategyExecutive/Board Changes
Avis Budget Announces Departure of Chief Digital Officer
Neutral
Sep 1, 2026
On September 1, 2026, Avis Budget Group, Inc. announced that Executive Vice President and Chief Digital Innovation Officer Ravi Simhambhatla will be leaving the company, with his departure set for September 30 to allow for a smooth transition. Th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.