Avis Stock Soars Over 200% in Two Weeks as Short Interest Hits 58%
Avis Budget stock jumped over 200% in 10 trading sessions, forcing short sellers to record $2.5 billion in mark-to-market losses as short interest climbed to 58% of free float. Short interest was 54% before the rally and shares later fell 19% from peak highs.
1. Rapid Share Surge and Short Covering
Avis Budget shares surged more than 200% over 10 trading sessions, triggering a massive short squeeze. Short interest rose to 58% of free float—the highest in a decade—inflicting roughly $2.5 billion in mark-to-market losses before the stock retraced 19% from its highs.
2. Rally Catalysts and Investor Flows
The rally kicked off after Pentwater Capital Management disclosed a sizable stake, while increased airport congestion during a partial government shutdown boosted rental demand. Retail investor flows turned negative in April, with daily outflows of $10 million to $12 million—the largest on record for the stock.
3. Analyst Views and Valuation Concerns
Of eight analyst ratings, only one remains a buy following a downgrade to hold by Deutsche Bank, citing difficulty justifying the current share price. Analysts warn of continued volatility and a material risk of further upside driven by additional short covering.