Avis Budget Soars To Record On Squeeze-Driven Buying

Overview

• The stock surged 24% in one session then dropped 7.6% the next day, capping a roughly 264% gain over the past month and a run to record levels.
• A short squeeze helped propel the rally, with short interest reported at more than 26% of the public float.
• Heavy call buying pushed options dealers to buy shares to hedge, which can magnify gains when few shares are available to trade.
• Airport security delays tied to TSA staffing issues pushed some travelers to drive, lifting near-term demand expectations for rental cars including Avis and Hertz.
• Analysts highlight a wide gap with fundamentals, citing a Q4 loss of $4.60 per share, a recent net loss near $747 million, long-term debt around $8.66 billion, and price targets clustered near $106 to $128.