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Hertz Stock Rises as Analysts Initiate Coverage of Car-Rental Giant

Hertz shares are higher. Several analysts initiate coverage as the car-rental giant continues its climb out of bankruptcy proceedings.

Several analysts resumed or initiated coverage of Hertz Global Holdings  (HTZ) - Get Hertz Global Holdings Inc Report as the iconic vehicle rental giant continues its climb out of bankruptcy proceedings.

Shares of the Estero, Fla., company at last check were up nearly 2% to $24.50.

The company was driven into bankruptcy proceedings last year due to the Covid-19 shutdown. Hertz emerged from bankruptcy in July.

Deutsche Bank analyst Chris Woronka resumed coverage of Hertz with a buy rating and $34 price target.

"Our sense is that it will likely take some time for many investors to reengage on the HTZ story," Woronka said in a research note. 

That's because "the stock was trading off of the major exchanges for nearly 18 months and the company was unable to be visible with the investment community."

That said, the analyst said, "the potential ability to broaden out the investor base in light of a larger market cap and forward-looking growth initiatives that can appeal to multiple investor groups should be viewed as a positive catalyst."

JPMorgan analyst Ryan Brinkman initiated coverage of Hertz with an overweight rating and $30 price target. 

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Brinkman said that he saw a "number of very strong industry and macro tailwinds" for the company, including an "unprecedentedly strong" used-vehicle pricing backdrop and the supply/demand imbalance affecting rental cars. 

There is no quick or easy solution to the global semiconductor shortage constraining light-vehicle production, Brinkman added. 

He said that an investment in Hertz offers investors "substantial upside exposure to potentially higher-than-expected inflation."

Goldman Sachs analyst Stephen Grambling initiated coverage of Hertz at neutral with a $32 price target.

Hertz is benefiting from an "ideal backdrop" for the rental-car industry of rapidly recovering travel demand, reduced supply of industrywide fleets and a broader vehicle shortage driving up used-car pricing, Grambling said.

Grambling said, however, that he saw a "wide-risk reward" balance, saying Hertz's strategic pivot is "still proving out."

Analysts at Barclays initiated coverage of Hertz with an overweight rating while Morgan Stanley kicked off coverage with an equal weight rating.

In October, Hertz reported stronger-than-expected third-quarter results, as the company benefited from the recovery in travel.