Hertz Global Holdings, Inc. Just Released Its Annual Results And Analysts Are Updating Their Estimates
One of the biggest stories of last week was how Hertz Global Holdings, Inc. (NYSE:HTZ) shares plunged 35% in the week since its latest annual results, closing yesterday at US$13.15. It looks like the results were pretty good overall. While revenues of US$9.8b were in line with analyst predictions, statutory losses were much smaller than expected, with Hertz Global Holdings losing US$0.83 per share. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether analysts have changed their earnings models, following these results.
View our latest analysis for Hertz Global Holdings
Following the latest results, Hertz Global Holdings's six analysts are now forecasting revenues of US$10.1b in 2020. This would be a satisfactory 3.5% improvement in sales compared to the last 12 months. Prior to the latest earnings, analysts were forecasting revenues of US$10.1b in 2020, and did not provide an EPS estimate. From what we can see of these results, it looks like Hertz Global Holdings is performing in line with analyst expectations. The analysts we track have all updated their numbers following the results, and there were no major changes to their forecasts for next year.
We'd also point out that that analysts have made no major changes to their price target of US$20.11. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Hertz Global Holdings at US$38.00 per share, while the most bearish prices it at US$12.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't assign too much meaning to the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that analysts are forecasting Hertz Global Holdings to grow faster in the future than it has in the past, with revenues expected to grow 3.5%. If achieved, this would be a much better result than the 0.1% annual decline over the past five years. Compare this against analyst estimates for the wider market, which suggest that (in aggregate) market revenues are expected to grow 5.8% next year. Although Hertz Global Holdings's revenues are expected to improve, it seems that analysts are still bearish on the business, forecasting it to grow slower than the wider market.
The Bottom Line
The biggest takeaway for us from these new estimates is the bullish forecast for profits next year. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Hertz Global Holdings's revenues are expected to perform worse than the wider market. The consensus price target held steady at US$20.11, with the latest estimates not enough to have an impact on analysts' estimated valuations.
We have estimates for Hertz Global Holdings from its six analysts , and you can see them free on our platform here.
It might also be worth considering whether Hertz Global Holdings's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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