Avis Budget Group (NASDAQ:CAR) gained ground during early trading on Thursday, whereas Hertz Global (NASDAQ:HTZ) observed a decline. This market reaction was catalyzed by renewed attention from analysts who weighed in on these prominent car rental stocks.

Analysts’ Assessments

J.P. Morgan downgraded Hertz (HTZ) to a Neutral rating from Overweight. Analyst Ryan Brinkman voiced concerns about the company’s ongoing efforts to recover from an unsuccessful electric vehicle strategy. This strategy debacle has resulted in approximately $500 million in losses, primarily due to the depreciating value of used electric vehicles, escalated collision repair costs, and reduced utilization stemming from the scarcity of spare parts for repairing damaged Teslas.

Deutsche Bank also adjusted its stance on Hertz Global (HTZ), shifting from a Buy rating to a Hold. The institution expressed doubts about HTZ’s earnings potential in the coming years, citing the company’s beleaguered EV strategy. Conversely, Deutsche Bank upgraded Avis Budget Group (CAR), commending its consistent operational performance and predicting that it is well-positioned to deliver earnings that align with current market expectations.

Seeking Alpha analysts have also voiced their preference for Avis Budget (CAR) over Hertz Global (HTZ), with an overarching Buy consensus rating in place.

Market Impact

Avis Budget (CAR) experienced a 4.35% increase during early trading on Thursday, while Hertz Global (HTZ) encountered a 3.05% decline. Hertz (HTZ) is scheduled to announce its Q4 earnings on February 6, whereas Avis Budget (CAR) will disclose its financial results on February 12.