Hertz Global Holdings Inc. ( HTZ - Snapshot Report ) has been outperforming quarterly earnings estimates for more than two years now; most recently beating the Zacks Consensus Estimate by 5% in the third quarter of 2012. Moreover, this Zacks Rank #1 (Strong Buy) car rental company has gained about 64.1% since late July 2012.

With a forward price-to-earnings (P/E) multiple of just 9.7 and a price-to-sales (P/S) ratio of 0.8, HTZ looks like a solid value pick.

Robust Q3 Beat

On Oct 31, Hertz posted third-quarter 2012 earnings of 63 cents per share, beating the Zacks Consensus Estimate by 3 cents and marking a substantial improvement from last year’s 51 cents. A double-digit growth in the top line coupled with effective cost management acted as catalysts.

Total revenue was up 3.4% to $2,516.2 million, reflecting sales increases of 2.1% and 12.8% across car rental and equipment rental segments, respectively.

Buoyed by better-than-expected results, management reiterated its guidance for 2012 and continues to expect revenue between $8.9 billion and $9.0 billion. Earnings are expected at $1.28 to $1.38 per share.

Earnings Estimates Trend Higher

Over the past 60 days, the Zacks Consensus Estimate for 2012 grew 0.8% to $1.34 per share, representing year-over-year growth of 38.3%. The Zacks Consensus Estimate for 2013 advanced 19.2% to $1.80 over that timeframe, suggesting a year-over-year improvement of nearly 34.4%.

Value Fundamentals

The forward prospects of Hertz remain promising, as is evident from a P/E multiple of 9.7, a P/S ratio of 0.8 and a P/B ratio of 2.9. (A P/E below 15.0, a P/S ratio less than 1.0 and a P/B ratio under 3.0 generally suggest a value stock.) In addition to being a value stock, Hertz remains attractive given its earnings growth prospects.

Founded in 1918 and headquartered in Park Ridge, New Jersey, Hertz Global Holdings operates car and equipment rental businesses globally. The company reports through two segments – Car Rental and Equipment Rental. One of the premium airport general use car rental brands, Hertz operates from approximately 8,800 locations in about 150 countries. The company runs its equipment rental business from roughly 340 branches in the United States, Canada, China, France, Spain, Saudi Arabia and international licensees. Hertz has a market cap of $7.36 billion.

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