Avis Budget Group, Inc. CAR reported mixed fourth-quarter 2023 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
Adjusted earnings of $7.1 per share beat the consensus estimate by 62.8% but plunged 32.1% year over year. Total revenues of $2.76 billion missed the consensus estimate by 1.3% and decreased slightly from the year-ago reported figure.
Investors seem to be unimpressed by the earnings beat as shares of CAR declined 6.7% from the date of earning release on Feb 12.
Performance Analysis
Avis Budget Group, Inc displayed a rather disappointing performance in the fourth quarter of 2023, with a perplexing contradiction between earnings and revenues. Despite an earnings beat, the company found itself in a disheartening position, as its stock value experienced a sharp decline of 6.7% following the release of the quarterly results on Feb 12.
Avis Budget Group, Inc. Price, Consensus and EPS Surprise
Avis Budget Group, Inc. price-consensus-eps-surprise-chart | Avis Budget Group, Inc. Quote
Segmental Analysis
The Americas segment’s revenues of $2.17 billion decreased 1.8% year over year. The figure missed our estimate of $2.78 billion.
The International segment’s revenues of $597 million beat our estimate by 8.3% and increased 5.3% year over year.
Profitability and Financial Health
Adjusted EBITDA was $311 million, down 53% year over year. Adjusted EBITDA margin was 11.25% compared with 23.75% in the year-ago quarter.
Adjusted EBITDA for the Americas segment was $309 million, down 50% year over year. Internationally, adjusted EBITDA was $28 million, down 56% from the year-ago figure.
Balance Sheet and Cash Flow
Avis Budget exited fourth-quarter 2023 with cash and cash equivalents of $555 million compared with $572 million at the end of the previous quarter. Corporate debt was $4.82 billion compared with $4.67 billion at the end of the previous quarter.
Operational and Financial Highlights
Throughout the fourth quarter of 2023, Avis Budget exhibited a significant decline in performance, evidenced by a notable decrease in cash equivalents, mounting corporate debt, and a substantial drop in adjusted EBITDA margin by 12.5% when juxtaposed against the previous year’s performance.
The company’s poor financial health can be further gauged by the significant decrease in adjusted EBITDA itself, outlining the challenges faced by Avis Budget in maintaining robust operational profitability.
Earnings Snapshot of Some Business Services Stocks
Automatic Data Processing, Inc. ADP reported impressive second-quarter fiscal 2024 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted earnings per share (EPS) of $2.13 beat the consensus estimate by 1.4% and grew 8.7% from the year-ago fiscal quarter’s figure. Total revenues of $4.67 billion surpassed the consensus estimate by 0.2% and improved 6.3% from the year-ago fiscal quarter’s reading on a reported basis as well on an organic constant-currency basis.
Booz Allen Hamilton Holding Corp. BAH reported better-than-expected third-quarter fiscal 2024 results.
Quarterly adjusted EPS of $1.41 surpassed the Zacks Consensus Estimate by 24.8% and exceeded the year-ago quarter by 31.8%. The company reported revenues of $2.57 billion, which beat the consensus estimate by 1.5% and increased 12.9% year over year. Revenues, excluding billable expenses, were $1.77 billion, up 13% year over year.
Waste Management Inc. WM reported impressive fourth-quarter 2023 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted EPS of $1.74 surpassed the Zacks Consensus Estimate by 13.7% and improved 33.9% year over year. Total revenues of $5.2 billion beat the consensus estimate by a slight margin and increased 5.7% year over year.
