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Avis Budget (CAR) Closes Deal to Extend Footprint in Poland

Zacks Equity Research

Vehicle rental & leasing services provider Avis Budget Group, Inc. CAR recently completed a transaction for an undisclosed amount to extend its operations in Poland. The transaction will facilitate the company to operate its Budget brand in the Polish market, which is considered to be one of the strategic hotspots in Eastern Europe.

Avis Budget operated the Budget brand in Poland since 1990 through a third-party licensee. Subsequently, the company acquired this licensee in Nov 2015. With the latest transaction, Avis Budget will gain an unrivaled coverage across the country, supporting seven airport rental locations, including Warsaw, Krakow and Gdansk.

The deal will enable the company to better serve its customers in the region through the addition of over 300 vehicles to its fleet. Through strategic acquisitions and organic growth across the industry verticals, Avis Budget expects to continuously extend its global footprint as well as strengthen its position in the existing markets.

With such opportune transactions, Avis Budget 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 outperformed the Zacks categorized Business Services industry in the last one year with an average return of 26.9% as against a decline of 6.2% 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 #3 (Hold). Some better-ranked stocks in the industry include Everi Holdings Inc. EVRI, Sajan, Inc. SAJA and First Data Corporation FDC, each carrying Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Everi has a long-term earnings growth expectation of 20%.

Sajan has a long-term earnings growth expectation of 25%.

First Data has a long-term earnings growth expectation of 18.8%.
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Avis Budget Group, Inc. (CAR): Free Stock Analysis Report
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