Zipcar, the leading car-sharing network and subsidiary of vehicle rental & leasing services provider Avis Budget Group, Inc. (CAR - Free Report) , recently forayed into the Latin American market by launching its services in Costa Rica. The strategic move is part of the international expansion plans of the company, whereby it aims to extend its presence in all the premier locations of the world.
At present, about 20 Zipcars are available for reservation services by the hour or by day throughout San Jose, Heredia and Alajuela. The services can be easily availed through prior booking facilities through the mobile app and can be chosen from a wide variety of car models. The reservation charges also include gas and insurance cover, making it cheap and affordable compared to high cost of car ownership.
Zipcar already has significant presence in over 500 cities and towns across Europe, Asia and North America. By setting its footprint in the Latin American market, it has widened its global network and coverage to almost all the leading locations of the world.
Avis Budget, the parent firm of Zipcar, intends to aggressively increase the number of company-operated locations in fast-growing markets. The company is particularly focused on expanding its Budget brand, taking its multi-brand strategy to the next level. We think that its fundamental drivers, such as sustained productivity growth, implementation of pricing initiatives and potential revenue-generating synergies from its various acquisitions bode well for the future.
Avis Budget has outperformed the industry in the last three months with an average return of 65.8% compared with a gain of 3.9% for the latter. We envision strong U.S. demand trends for Avis Budget as travel volumes continue to perform well. Anticipating strong travel trends for both leisure and commercial travelers and projecting sustained expansion of these trends, we believe that Avis Budget’s various acquisitions and purchase of licensees will enhance its operational foothold in global markets.
Avis Budget currently has a Zacks Rank #4 (Sell). Better-ranked stocks in the industry include Healthcare Services Group, Inc. (HCSG - Free Report) , RPX Corporation and SPS Commerce, Inc. (SPSC - Free Report) , each carrying Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Healthcare Services Group has a long-term earnings growth expectation of 11%. It has beaten earnings estimates twice in the trailing four quarters with a positive surprise of 1.7%.
RPX Corporation has beaten earnings estimates thrice in the trailing four quarters with a positive surprise of 17.1%.
SPS Commerce has a long-term earnings growth expectation of 25%. It has beaten earnings estimates in each of the trailing four quarters with a positive surprise of 17%.
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