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what it is
Avis rents cars and trucks, and runs Zipcar, its car-sharing service.
how it gets paid
Last year Avis Budget made $11.7B in revenue. U.S. vehicle rental was the main engine at $6.3B, or 54% of sales.
why growth slowed
Revenue fell 1.2% last year. Revenue was up 155% vs. prior year, but the quarter still produced a loss.
what just happened
$9.0B of quarterly revenue did not stop EPS from landing at -$4.02.
At a glance
B balance sheet — gets the job done, barely
5/100 earnings predictability — expect surprises
11.2x trailing p/e — the market's not buying it — or you found a deal
7.6% return on capital — nothing to write home about
xvary composite: 46/100 — below average
What they do
Avis rents cars and trucks, and runs Zipcar, its car-sharing service.
You get a network in 180 countries and nearly 10,250 locations. Leaving is painful when your rental plans are tied to that reach. Avis also completed over 38 million vehicle rental transactions in 2024, which is a lot of keys for a $4B company.
How they make money
$11.7B
annual revenue · their business grew -1.2% last year
U.S. vehicle rental
$6.3B
1.2%
International rental
$3.4B
+2.0%
Commercial truck rental
$1.6B
3.0%
Zipcar car sharing
$0.4B
0.0%
The products that matter
traditional vehicle rental
Avis and Budget Rentals
$5.9B · about half of revenue
the segment data shown here points to $5.9B in revenue, or roughly half of the $11.7B business. this is still the center of gravity.
core demand
car-sharing and mobility services
Zipcar and Mobility Services
$2.9B · 25% of sales
this part of the business brings in $2.9B, or about 25% of sales. it adds another demand stream, but the page data here is too thin to call it the main profit driver.
25% of sales
Key numbers
$11.7B
annual revenue
This is the top line Wall Street is paying for. It is large enough to matter, but it still fell 1.2% vs. prior year.
37.0%
operating margin
This says the core business can make money before the bottom line gets crushed by financing costs.
$25.3B
long-term debt
This is the bill hanging over the stock. At 85% of capital, it limits how much slack you get if demand cools.
11.2x
trailing p/e
You are not paying a rich multiple, but you are also not getting a balance sheet with room to relax.
Financial health
B
strength
- balance sheet grade B — adequate — nothing special
- risk rank 4 — safer than 20% of stocks
- price stability 5 / 100
- long-term debt $25.3B (85% of capital)
- net profit margin 4.5% — keeps 4 cents of every dollar in revenue
B — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in CAR 3 years ago → it's now worth $8,050.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
$9.0B of quarterly revenue did not stop EPS from landing at -$4.02.
Revenue was up 155% vs. prior year, but the quarter still produced a loss. That is the whole story: big volume, shaky profit.
$2.8B
revenue
-$4.02
eps
45.0%
gross margin
the number that mattered
The -$4.02 EPS matters because it shows the business can still miss the profit mark even with $9.0B of quarterly revenue.
-
avis budget group appeared to be gaining some momentum heading into the final stanza of 2025.
-
the company’s september-period results surpassed expectations on both earnings and revenue, after missing in the previous two quarters.the performance was highlighted by a return of top-line growth, something avis had not achieved since the third quarter of 2023.
-
an increase in rental days and strength in overseas markets represented key catalysts.
-
full-year results are scheduled to be released in mid-february.
-
we are targeting a swift earnings recovery in 2026.avis’ 2025 showing was weighed down by significant restructuring costs incurred during the first half of the year. much of this was tied to leadership’s accelerated rotation strategy, which resulted in sharp increases in vehicle depreciation and lease charges. on a positive note, expenses associated with the strategy shift are now fully in the rear view mirror.
source: company earnings report, 2026
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What could go wrong
the #1 risk is used-car depreciation colliding with a debt-heavy fleet model.
med
used-vehicle prices fall faster than expected
rental companies buy cars, rent them out, then sell them. if resale values weaken, depreciation rises and the earnings math changes fast.
with a 3.3% net margin, there is not much cushion for a fleet-cost surprise.
med
travel demand or rental pricing softens
the revenue base is $11.7B and it already slipped 1.2% last year. if airport volumes or pricing roll over, the pressure hits the whole business.
this is a cyclical model. weaker pricing does not need to be dramatic to hurt a thin-margin operator.
med
debt stays manageable until it doesn't
Avis Budget Group carries $25.3B in long-term debt, equal to 85% of capital. that is workable in a healthy operating stretch and far less comfortable in a weak one.
when the equity is worth about $4B, small changes in earnings can feel very large in the stock.
all three risks hit the same weak spot: a $11.7B business keeping 3.3 cents of profit per revenue dollar while carrying $25.3B in long-term debt.
source: institutional data · regulatory filings · risk analysis
Pay attention to
risk
used-car values and depreciation
this is the pressure point. fleet economics decide whether the 3.3% net margin holds or disappears.
metric
Q4 EPS versus the $0.45 setup
the street already expects a profit rebound. you care less about a beat and more about whether recovery starts to look repeatable.
trend
revenue turning back up
sales fell 1.2% last year. if revenue stays flat while costs move higher, the low multiple stops looking cheap.
calendar
the next few quarters of debt optics
$25.3B in long-term debt is manageable only if operating results stabilize. you want debt to stop being the first number on the page.
Analyst rankings
short-term outlook
average
momentum score 3 — the stock is not sending a strong short-term signal either way.
risk profile
below average
stability score 4 — safer than 20% of stocks. in human-speak, this is a volatile name.
chart momentum
top 5%
technical score 1 — the highest rating. analysts see strong recent price momentum even if the business story is still uneven.
earnings predictability
5 / 100
earnings have been hard to model. if you own this, you should expect surprises.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 146 buyers vs. 135 sellers in 3q2025. total institutional holdings: 44.1M shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$44
$186
$129
current price
$115
target midpoint · 11% from current · 3-5yr high: $205 (+60% · 12% ann'l return)
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