Back to top

Hertz to Go on Hiring Spree

Read MoreHide Full Article

With the economy improving modestly, major companies are looking to recruit the optimum number of employees required to operate effectively. As per the U.S. Department of Labor, the employment to population ratio increased to 58.6% in May 2012 compared with 58.4% in the comparable prior-year period.

In order to improve customer service, Hertz Global Holdings, Inc. (HTZ - Free Report) , engaged in vehicle and equipment rental operations, plans to recruit hundreds of employees at its equipment rental division, Hertz Equipment Rental Corporation (HERC) this summer.

The company further looks to organize a two-day open house employment program over 50 HERC locations on June 26, 2012 and June 27, 2012. Further information about the open house session is available on the company’s website.

HERC is one of the largest equipment rental operators in the United States with a diversified portfolio. The company expects HERC’s revenue to grow at the rate of 15% year over year in fiscal year 2012.

Moreover, HERC completed the acquisitions of Cinelease and Arpielle in the first quarter of 2012, and management believes that the acquisitions have already started paying off through incremental revenue growth, which led to increased profits.

As a result, in order to sustain sales growth, management intends to recruit more employees. Management expects that the recruitment program will drive higher level of customer satisfaction.

Hertz, which competes with Avis Budget Corp Inc. (CAR - Free Report) , recently posted better-than-expected first-quarter 2012 earnings. The earnings of 5 cents per share marked a substantial improvement from a loss of 3 cents in the comparable prior-year quarter. Moreover, reported earnings surpassed the Zacks Consensus Estimate of 4 cents a share.

Total revenue came in at $1.96 billion, jumping 10.2% year over year, and reflecting sales increases of 9.8% and 12.6% across car rental and equipment rental segments, respectively.

Buoyed by better-than-expected results, management provided upbeat guidance for 2012. Management now expects revenue of between $8.9 billion and $9.0 billion, up from the range of $8.85 billion to $8.95 billion forecasted earlier. Earnings are now projected at between $1.28 and $1.38 per share versus previous expectations of $1.16 to $1.26.

Modest economic recovery, new market opportunities, cost containment efforts and improving trends in the equipment rental business imparts a short-term Zacks #1 Rank on the shares, implying Strong Buy rating for 1-3 months. This correlates with our long-term Outperform recommendation.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Hertz Global Holdings, Inc (HTZ) - free report >>

Avis Budget Group, Inc. (CAR) - free report >>

More from Zacks Analyst Blog

You May Like