Hertz EBITDA Turns Positive as Cash Flow Stabilizes, Debt Maturities Extended
Hertz shares trade at $4.94 with a trailing P/E of 23.7 and forward P/E of 11.8 after an ill-timed EV expansion and aggressive buybacks drove negative free cash flow. Fleet rotation at normalized prices and rightsized EV exposure have turned EBITDA positive, with seasonal de-fleeting set to accelerate deleveraging and support cash flow.
1. Fleet Rotation and EV Exposure Adjustment
Following post-bankruptcy misallocations into share buybacks and an oversized electric vehicle rollout, Hertz has completed its fleet rotation at normalized used-car prices and scaled back EV purchases to curb losses from rapid price cuts.
2. Cash Flow Stabilization and Positive EBITDA
Operational discipline has shifted free cash flow toward breakeven, with EBITDA returning to positive territory in the latest quarter and seasonal de-fleeting expected to generate further cash for debt reduction.
3. Liquidity Position and Debt Maturities
The company holds ample liquidity with key non-vehicle debt maturities extended to 2028 and 2029, while an uptick in used-car values bolsters residual values and profitability.
4. Stock Valuation and Market Position
Shares trade near $4.94, implying a trailing P/E of 23.7 and forward P/E of 11.8, and as the third-largest global car rental operator in a 95% concentrated market, normalized operations could trigger a meaningful rerating.