Hertz (HTZ) Stock Up Following Updated Metrics

NEW YORK (TheStreet) -- Shares of Hertz Global Hldgs  (HTZ) were up 5.11% to $20.56 on heavy volume in late morning trading Friday, after the car rental company issued its 2015 first quarter operating results and updated metrics yesterday.

Hertz said car rental revenue fell 3% to $1.5 billion domestically, and declined by 9% to $436 million internationally, based on unaudited first-quarter results.

Looking ahead the company revised its fleet capacity plan and expects strong seasonal demand.

The company projects U.S. fleet capacity to increase 1.5% to 2.5% from a year ago, while international fleet capacity is expected to rise 1% to 2% compared with 2014.

Hertz said it would increase prices at its U.S. Hertz, Dollar and Thrifty brand locations, starting June 14.

The company will also close about 200 stores, representing 5% of the total off-airport locations and less than 1% of the vehicle fleet. The closures will result in approximately $10 million in annual savings.

MKM Partners analyst Christopher Agnew issued a note earlier today, pointing to a brighter outlook in the second half of 2015.

The firm said Hertz's updated first quarter metrics "were not unexpected." Revenue headwinds were disappointing, but several data points were "much better than feared."

Agnew kept a "buy" rating, and said shares of Hertz should be higher on this update. 

MKM expects a strong comeback in 2016, but added that earnings will be muted.

"We are updating estimates to reflect FX headwinds, tougher 1H operating environment, weaker HERC and the revised fleet growth plans," the firm wrote.

MKM lowered its price target to $28 from $31.

Shares have fallen more than 27% over the past 52-weeks.

About 6.96 million shares have exchanged hands as of 11:38 a.m. ET today, compared to its average trading volume of about 6.01 million shares a day. 

Naples, Fla.-based Hertz operates car rental business through the Hertz, Dollar, Thrifty and Firefly brands from 11,555 corporate and franchisee locations around the world.

The company operates in four business segments including U.S. car rental, international car rental, worldwide equipment rental, and all other operations.

Separately, TheStreet Ratings team rates HERTZ GLOBAL HOLDINGS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate HERTZ GLOBAL HOLDINGS INC (HTZ) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."

You can view the full analysis from the report here: HTZ Ratings Report

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