Hertz accounting backlash: New costs, spinoff delay, execs to go dark on CC

Hertz (HTZ) says the widespread accounting problems at the company could delay the planned separation of its equipmental-rental business.

Costs tied to the accounting flap are likely to pull Q1 results below consensus estimates.

Q1 earnings tallies will be released by Hertz on June 9, but execs with the company will go dark for its planned conference call.

SEC Form 8-K

HTZ -11.1% premarket.

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Comments (6)
  • Invest84
    , contributor
    Comments (327) | Send Message
    Does anyone have an educated opinion on what is going on - is this stuff material to the ongoing operations of the business or is this just one-time in nature?


    It sounds like the latter but when accounting issues spring up, it is possible there is a more serious issue with management.
    6 Jun 2014, 09:23 AM Reply Like
  • june1234
    , contributor
    Comments (4504) | Send Message
    I like issues ,has a nice ring to it. Used to call it fraud or incompetence back in the day now its "issues" or "irregularities".
    6 Jun 2014, 10:42 AM Reply Like
  • ceristeare
    , contributor
    Comments (1154) | Send Message
    still long CAR
    6 Jun 2014, 11:28 AM Reply Like
  • Invest84
    , contributor
    Comments (327) | Send Message
    I doubt this is fraud - incompetence, maybe.
    6 Jun 2014, 12:43 PM Reply Like
  • Jean Smith
    , contributor
    Comments (143) | Send Message
    It's time to buy Htz. I did.If it goes lower.I will increase my holdings.Again,patience is the name of the game !Guaranteed,it will make a nice comeback. Do I know when?Not at all.Better then idle money.It is too big to fail.
    9 Jun 2014, 04:01 PM Reply Like
  • Invest84
    , contributor
    Comments (327) | Send Message
    Jean - Too big to fail - doubtful. I don't necessarily think that this will sink the company. But HTZ has had a nice run over the past couple years, and even if it drops to $26 - it's still trading at 14x 2014E EPS of $1.81 (and who knows what the revised EPS is going to be). While this is cheaper than the market and CAR is trading at a significant premium - it's not ridiculous.


    Also, it's not like HTZ is knocking the cover off the ball - US rental revenue as up 4.5% vs. rental revenue per day which was down 1.6% due to excess fleet (which further proves management's inability to efficiently manage the business). This compares to CAR's North American organic revenue increase of 7%.


    So while the price has taken a hit - I think the market has given us false confidence that everything automatically just goes back up. I'm probably a buyer if it gets down to $22 due to tailwinds in the industry. Rising tides lifts all boats - maybe even those with holes in it.
    10 Jun 2014, 10:14 AM Reply Like
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