Car-rental company Hertz Global Holdings said Monday its Q3 net income rose 51% on record revenue, and said full-year 2007 revenue and income will be at the upper-end or above prior guidance of $8.5-8.6 billion in revenue and EPS of $1.15 to $1.22. Third-quarter earnings were $162.7 ($0.50/share), up from $107.5 million ($0.46/share) a year ago. Adjusted EPS were $0.65 vs. $0.48, beating analyst estimates of $0.57. Revenue climbed 9.4% to $2.45 billion from $2.24 billion, beating analysts' $2.38 billion revenue forecast. Car rental revenue was up 11% to $1.98B, while equipment rentals climbed just 2.6% on U.S. housing-market weakness which saw rental prices fall 0.1%. "Equipment rental volume continues to be affected by slower growth in the U.S. construction market," CEO Mark P. Frissora said. The company operated just over half a million cars during the quarter. "Management's strategy to grow revenue, improve operating efficiency and offset rising fleet costs will continue to generate sustainable operating performance improvement," Fitch analyst William Artz wrote on Oct. 4, upon revising Hertz's debt outlook to positive from stable. Hertz has dismissed more than 2,000 employees in an effort to reduce costs. Shares have climbed 48.6% since the company went public last November.
Commentary: Ideal Capital Structure For the Auto Retailers
Stocks to watch: HTZ. Competitors: CAR, URI
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