Trade-Ideas LLC identified

Hertz Global Holdings

(

HTZ

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Hertz Global Holdings as such a stock due to the following factors:

  • HTZ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $88.6 million.
  • HTZ has traded 660,785 shares today.
  • HTZ is down 3.3% today.
  • HTZ was up 6.7% yesterday.

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More details on HTZ:

Hertz Global Holdings, Inc. engages in the rental and lease of cars and trucks worldwide. It operates through four segments: U.S. Car Rental, International Car Rental, Worldwide Equipment Rental, and All Other Operations. HTZ has a PE ratio of 14. Currently there are 4 analysts that rate Hertz Global Holdings a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Hertz Global Holdings has been 9.9 million shares per day over the past 30 days. Hertz Global has a market cap of $3.6 billion and is part of the services sector and diversified services industry. The stock has a beta of 2.27 and a short float of 10.1% with 3.56 days to cover. Shares are down 36% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Hertz Global Holdings as a

sell

. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, generally high debt management risk and weak operating cash flow.

Highlights from the ratings report include:

  • HTZ's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 58.00%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • The debt-to-equity ratio is very high at 7.89 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • Net operating cash flow has decreased to $577.00 million or 26.21% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • 44.70% is the gross profit margin for HERTZ GLOBAL HOLDINGS INC which we consider to be strong. Regardless of HTZ's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HTZ's net profit margin of -2.20% significantly underperformed when compared to the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 15.2%. Since the same quarter one year prior, revenues slightly dropped by 5.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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