Between then and now the company, which has since been forced to restate years of financial results, fooled some of the smartest hedge fund managers -- who viewed it as one of the must-have investments.
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But it was back in 2009, when Hertz sued the independent research firm, Audit Integrity that the warning bells should've gone off. Audit Integrity had the audacity to lump Hertz in with a bunch of other companies it said faced "the greatest risk of bankruptcy" over the next 12-month period.
As Aaron Elstein pointed out at the time in an exceptionally good piece in Crain's New York Business:
"Not surprisingly, plenty of outfits were furious. An outraged CBS Corp. (CBS) called Audit Integrity's work 'flawed pseudo-analysis' with 'no basis in fact or reason.' Macy's (M) hissed, 'We very much disagree with the conclusion of the report.'
"But Audit Integrity really hit the nation's largest car renter where it Hertz.
"Park Ridge, N.J.-based Hertz Global Holdings Inc., struggling to regain its footing after a $1.2 billion net loss last year, sued Audit Integrity and its chief executive, Jack Zwingli, alleging defamation and trade libel."
To those of us who have been doing this for a while, suing critics is almost always like walking around Times Square with a sign on your back that says, "I've got something to hide."
With Hertz, we now know it had plenty to hide.
Not only has it been forced to restate years of results, but the CEO who was at the helm when Audit Integrity was sued, Mark Frissora, resigned in September as pressure from investors mounted.
Hertz is now pulling out all stops to revive itself, including upgrading its fleet with more new cars -- and perhaps not a moment too soon.
It appears, as part of the smoke and mirrors to keep its earnings elevated, Hertz let its fleet age, not necessarily gracefully. While that may have kept costs down, it also put Hertz in a precarious if not perilous position when it came to selling its cars. The real business of the car rental business, after all, is selling used cars.