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Is a Disappointment in Store for Hertz (HTZ) in Q1 Earnings?
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Hertz Global Holdings Inc. (HTZ - Free Report) is scheduled to release first-quarter 2017 results on May 8. The big question facing investors is whether this car rental company will be able to deliver a positive earnings surprise in the quarter to be reported.
This quarter will mark Hertz’s fourth earnings release as a stand-alone entity. In fourth-quarter 2016, the company posted a negative earnings surprise of 31.5%, marking its second straight miss. A look at Hertz’s earnings estimates revisions shows that the Zacks Consensus Estimate for the first quarter and fiscal 2017 has been going down in the last 30 days.
In the fourth quarter, Hertz suffered a loss and also recorded soft revenues. Revenues fell year over year mainly due to soft revenues at the International rental car segments, which was largely hurt by unfavorable currency movements. Additionally, fleet and service issues had an adverse impact on the results.
Moving ahead, Hertz remains focused on solving issues related to fleet and services, which were the main deterrents in 2016. In this regard, management plans to upgrade fleet quality and mix in the U.S. as well as provide employees with the required tools and training, to offer improved services to customers. That said, the company remains keen on making investments in fleet, services, marketing and technology in 2017, which in turn should drive top-line growth.
Nonetheless, the aforementioned negative factors and unfavorable currency movements make us cautious about the upcoming results. Moreover, Hertz’s stock price movement remains disappointing as the company has underperformed the Zacks categorized Transportation–Services industry year to date. The stock has crashed 32.2%, while the industry gained a marginal 0.2%.
Earnings Whispers
Our proven model does not conclusively show that Hertz is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below:
Zacks ESP: Earnings ESP for Hertz is currently pegged at -55.32%. This is because both the Most Accurate loss estimate of $1.46 is substantially wider than the Zacks Consensus Estimate of a loss of 94 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Hertz currently has a Zacks Rank #4 (Sell). We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Home Depot Inc (HD - Free Report) , slated to release earnings on May 16, currently has an Earnings ESP of +0.62% and a Zacks Rank #2 (Buy).
Best Buy Co. Inc. (BBY - Free Report) , scheduled to release earnings on May 25, currently has an Earnings ESP of +12.50% and a Zacks Rank #2.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>
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Is a Disappointment in Store for Hertz (HTZ) in Q1 Earnings?
Hertz Global Holdings Inc. (HTZ - Free Report) is scheduled to release first-quarter 2017 results on May 8. The big question facing investors is whether this car rental company will be able to deliver a positive earnings surprise in the quarter to be reported.
This quarter will mark Hertz’s fourth earnings release as a stand-alone entity. In fourth-quarter 2016, the company posted a negative earnings surprise of 31.5%, marking its second straight miss. A look at Hertz’s earnings estimates revisions shows that the Zacks Consensus Estimate for the first quarter and fiscal 2017 has been going down in the last 30 days.
Hertz Global Holdings, Inc Price and EPS Surprise
Hertz Global Holdings, Inc Price and EPS Surprise | Hertz Global Holdings, Inc Quote
Factors Influencing this Quarter
In the fourth quarter, Hertz suffered a loss and also recorded soft revenues. Revenues fell year over year mainly due to soft revenues at the International rental car segments, which was largely hurt by unfavorable currency movements. Additionally, fleet and service issues had an adverse impact on the results.
Moving ahead, Hertz remains focused on solving issues related to fleet and services, which were the main deterrents in 2016. In this regard, management plans to upgrade fleet quality and mix in the U.S. as well as provide employees with the required tools and training, to offer improved services to customers. That said, the company remains keen on making investments in fleet, services, marketing and technology in 2017, which in turn should drive top-line growth.
Nonetheless, the aforementioned negative factors and unfavorable currency movements make us cautious about the upcoming results. Moreover, Hertz’s stock price movement remains disappointing as the company has underperformed the Zacks categorized Transportation–Services industry year to date. The stock has crashed 32.2%, while the industry gained a marginal 0.2%.
Earnings Whispers
Our proven model does not conclusively show that Hertz is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below:
Zacks ESP: Earnings ESP for Hertz is currently pegged at -55.32%. This is because both the Most Accurate loss estimate of $1.46 is substantially wider than the Zacks Consensus Estimate of a loss of 94 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Hertz currently has a Zacks Rank #4 (Sell). We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Home Depot Inc (HD - Free Report) , slated to release earnings on May 16, currently has an Earnings ESP of +0.62% and a Zacks Rank #2 (Buy).
Wal-Mart Stores Inc. (WMT - Free Report) , scheduled to release earnings on May 18, currently has an Earnings ESP of +2.08% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Best Buy Co. Inc. (BBY - Free Report) , scheduled to release earnings on May 25, currently has an Earnings ESP of +12.50% and a Zacks Rank #2.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>