Hertz Global's (HTZ) Q3 Earnings Surpass Estimates, Rise Y/Y
Hertz Global Holdings HTZ performed impressively in the third quarter of 2018, reporting better-than-expected earnings and revenues.
The company’s earnings came in at $2.14 per share (excluding 46 cents from non-recurring items), which surpassed the Zacks Consensus Estimate of $1.78. The bottom line also increased significantly on a year-over-year basis. Results were aided by higher revenues.
Quarterly revenues of $2.76 billion outpaced the Zacks Consensus Estimate of $2.64 billion and improved 7.2% on a year-over-year basis. Strength across majority of the segments drove the top line.
Segmental Performance
In the quarter under review, the U.S. Rental Car segment generated revenues of $1,852 million, up 10% year over year. The improvement can be attributed to increased volumes and pricing both on and off airport.
Vehicle utilization improved 30 basis points to 81% on the back of efficient fleet management. Excluding fleet dedicated to transportation network companies ("TNC") rentals, revenues increased 8%. In third-quarter 2018, direct vehicle operating and selling, general and administrative costs (as a % of total segmental revenues) increased to 65% from 63% a year ago.
The International Rental Car segment generated revenues of $732 million, up 1% year over year (3% excluding foreign currency impact). Total revenue per transaction day (RPD) rose3%.
Segmental direct vehicle operating and selling, general and administrative costs (as a % of total segmental revenues) increased to 61% from 60% a year ago. Revenues from all other operations improved 9% to $174 million.
Hertz Global Holdings, Inc Price, Consensus and EPS Surprise
Hertz Global Holdings, Inc Price, Consensus and EPS Surprise | Hertz Global Holdings, Inc Quote
Balance Sheet and Cash Flow
Hertz Global, sporting a Zacks Rank #1 (Strong Buy), exited third-quarter 2018 with cash and cash equivalents of $761 million compared with $1,072 million at the end of 2017. Restricted cash at the end of the quarter was $265 million compared with $432 million at the end of 2017. You can see the complete list of today’s Zacks #1 Rank stocks here.
As of Sep 30, 2018, total debt amounted to $17,158 million compared with $14,865 million as of Dec 31, 2017. Cash flows provided by operating activitiesfor the first nine months of the year totaled $2,017 million compared with $1,977 million in the year-ago comparable period.
Upcoming Releases
Investors interested in the broader Transportation sector are keenly awaiting quarterly results from key players like Copa Holdings S.A. CPA, Teekay Tankers Ltd. TNK and Frontline Ltd. FRO. While Copa Holdings will report third-quarter earnings on Nov 14, Teekay Tankers and Frontline will do the same on Nov 15 and Nov 30, respectively.
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