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What's in the Cards for Hertz Global (HTZ) in Q4 Earnings?

Zacks Equity Research

Hertz Global Holdings HTZ is scheduled to report fourth-quarter 2019 financial numbers on Feb 24, after market close.

The company has a decent track record with respect to earnings per share. Its earnings  surpassed the Zacks Consensus Estimate in all the last four quarters.

Hertz Global Holdings, Inc Price and EPS Surprise

 

Hertz Global Holdings, Inc Price and EPS Surprise

Hertz Global Holdings, Inc price-eps-surprise | Hertz Global Holdings, Inc Quote

 

Considering this, let’s discuss the factors that might have had influenced the company’s performance in the quarter to be reported.

Similar to the first three quarters of 2019, Hertz Global's fourth-quarter performance is likely to have been aided by solid revenues at the U.S. Rental Car segment. Efficient fleet management is expected to have had driven growth in this unit. Additionally, efforts to control costs are likely to have had a positive impact on fourth-quarter bottom line.

However, the International Rental Car segment is likely to have delivered a below-par performance in the to-be-reported quarter. This is likely to have been caused by decreased volumes as a result of weakness in the European market. Furthermore, with Hertz Global investing significantly in its turnaround plan, the bottom line is likely to have been impacted by high costs in the to-be-reported

 What Does the Zacks Model Say

The proven Zacks model does not conclusively predict an earnings beat for Hertz Global this time around. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. However, that is not the case here as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Hertz Global has an Earnings ESP of 0.00% as the Most Accurate Estimate is pegged at a loss of 25 cents, in line with the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Hertz Global carries a Zacks Rank #3, currently.

Highlights of Q3 Earnings

Hertz Global’s earnings (excluding 34 cents from non-recurring items) of $1.60 surpassed the Zacks Consensus Estimate by 12 cents. However, quarterly earnings declined on a year-over-year basis. Moreover, quarterly revenues of $2,836 million lagged the Zacks Consensus Estimate. However, the top line improved 2.8% year over year courtesy of impressive performance in the U.S. Rental Car segment.

Stocks to Consider    

Investors may consider Azul SA AZUL, Frontline Ltd. FRO and LATAM Airlines Group S.A. LTM, as these stocks possess the right combination of elements to come up with earnings beat in their next releases.

 Azul SA is a Zacks #1 Ranked stock and has an Earnings ESP of +16.13%. The company is slated to report fourth-quarter figures on Mar 12.

Frontline is a Zacks #1 Ranked stock and has an Earnings ESP of +41.18% .The company is slated to report fourth-quarter figures on Feb 27.

LATAM Airlines has an Earnings ESP of +6.38% and currently holds a Zacks Rank of 2. The company will release fourth-quarter earnings numbers on Mar 3.

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Hertz Global Holdings, Inc (HTZ) : Free Stock Analysis Report
 
Frontline Ltd. (FRO) : Free Stock Analysis Report
 
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