Hertz Global Holdings, Inc. (HTZ) up on Insider Stock Purchases
Shares of Naples, Florida, based Hertz Global Holdings, Inc. (HTZ) rose on Tuesday, resisting the trend of a day that was broadly lower in stocks across the board. Hertz's stock was up 12.60%, rising 97 cents per share, to close at $8.67, on volume of 17,465,352 shares. The stock was up sharply on news that Hertz's CEO and other company officers recently purchased a large amount of the company's stock.
On Tuesday it was announced that Hertz president and CEO John Tague, purchased 66,000 shares of the company's stock in two purchases made in the past several days. Tague purchased the shares of Hertz stock at an average price of about $7.83 per share. The recent purchase brings Tague's total holdings of Hertz stock up to 200,200 shares. In addition to Tague's purchase, Chief Financial Officer Thomas Kennedy purchased 40,000 shares at $7.76 on Friday, while Chief Revenue Officer Jeffrey Foland bought 65,000 shares at $7.63, also on Friday.
The stock rose on the news, as insider buying of company stock is seen as a major vote of confidence in the future of the company. The impact of the insider purchases was magnified by the fact that Hertz's stock has performed poorly in the past two years. Even with Tuesday's price jump, the stock is still trading near the bottom of its 52-week trading range.
Last week Hertz announced its results for the first quarter of 2016, ended March 31. The company had a net loss of $51 million, or a loss of $0.12 per share. This represented improvement over its first quarter, 2015, results which had a net loss of $70 million, or a loss of $0.15 per share. However, on an adjusted basis, the company reported a first quarter loss of $52 million, or $-0.12 per share, compared to a net income of $2 million, or $0.00 per share for the first quarter of 2015. Total revenues for the first quarter of 2016 were $2.3 billion, a 6% decline versus the first quarter of 2015.
"During the first quarter, we followed through on our plans to bring fleet levels in line with expected demand in the U.S. market and saw a significant improvement in our fleet efficiency as a result," said Hertz president and chief executive officer, John Tague. "Though industry pricing decreased more than we anticipated, we mitigated the impact on our performance by continuing to lower our costs, which resulted in a 5% reduction in unit cost in our worldwide rental car business in the quarter...We are encouraged by recent pricing trends as we move into the peak season as well as by rising customer satisfaction across the Hertz, Dollar and Thrifty brands year-over-year."
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