Avis Budget Group, Inc. (CAR - Free Report) subsidiary, Avis Car Rental, announced its relaunch in Japan at Chitose International Airport on Hokkaido Island. The company’s long-time license partner, Idex Auto Japan, will operate the brand.
Notably, this marks the company's first launch among other openings scheduled in locations like Narita International Airport, Fukuoka International Airport and Kagoshima International Airport this summer. Offerings will include short- and long-term rentals, late-model vehicles along with Avis’s customer service.
We observe that shares of Avis have rallied a massive 63.4% over the past year, significantly outperforming the industry’s gain of 17.3%.
A Timely Move to Boost International Revenues
The relaunch of this brand appears well-timed as Japan will host the Rugby World Cup in 2019 and the Olympics in 2020, attracting a large number of tourists. Further, the Japanese government has moved to relax regulations on tourism, resulting in a steady increase in inbound tourism.
In fact, we believe this move is Avis’s latest strategy to enhance its global footprint through focusing on growing markets, where car rental demand is increasing. Thus, helping the company to boost revenues at its International segment. This segment licenses the company’s brands to third parties for vehicle rentals, and ancillary products and services in Europe, Africa, Asia, the Middle East and Australasia as well as operates car sharing business in some of these markets.
In the fourth quarter, revenues at the company’s International segment increased 19% year over year to $637 million. The improvement was owing to a 15% increase in rental days, including an 8% benefit from FranceCars acquisition.
Avis Budget Group, Inc. Revenue (TTM)
Avis has a large global network and coverage to almost all the major regions of the world. Moreover, it remains focused on fortifying its fleet with the addition of latest car models from leading manufactures to attract customers.
Zacks Rank & Other Stocks to Consider
Avis sports a Zacks Rank #1 (Strong Buy). Some other top-ranked stocks in the broader Business Services sector include WageWorks (WAGE - Free Report) , FTI Consulting (FCN - Free Report) and NV5 Global (NVEE - Free Report) , each carring the same bullish rank as Avis. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the trailing four quarters, WageWorks, FTI Consulting and NV5 Globalhave delivered a positive earnings surprise of 8.8%, 6.1% and 5.8%, respectively.
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