Avis Budget Group, Inc. (CAR) vs Herc Holdings Inc. (HRI)

Avis Budget Group, Inc. and Herc Holdings Inc. are both Rental & Leasing Services companies. Avis Budget Group, Inc. and Herc Holdings Inc. are of similar size ($4.2B and $3.9B). Avis Budget Group, Inc. has negative trailing earnings, so its P/E is not meaningful; Herc Holdings Inc. trades at 82.7×. Herc Holdings Inc. grew revenue faster over the last twelve months: 28.5% against 0.45%. Herc Holdings Inc. has the higher net margin (1.01% vs −5.43%) and the higher return on invested capital (4.04% vs 0.15%). Across the 20 metrics below, Avis Budget Group, Inc. leads on 10 and Herc Holdings Inc. on 10.

Valuation

Metric CAR HRI Rental & Leasing Services median
P/E n/m 82.70 18.17
P/S 0.31 0.84 0.92
P/B n/m 2.15 2.15
Price to free cash flow 1.36 10.20 7.80
EV/EBITDA 5.80 6.28 7.72
EV/Sales 2.47 2.48 2.47
Earnings yield (17.54%) 1.21% 1.00%
Free cash flow yield 73.39% 9.80% 1.43%

Profitability

Metric CAR HRI Rental & Leasing Services median
Gross margin 49.40% 51.98% 49.40%
Operating margin 8.49% 13.12% 8.49%
Net margin (5.43%) 1.01% 1.01%
Free cash flow margin 22.75% 8.20% 1.87%
Return on equity 20.83% 2.58% 12.13%
Return on assets (1.97%) 0.35% 0.24%
Return on invested capital 0.15% 4.04% 2.80%

Growth

Metric CAR HRI Rental & Leasing Services median
Revenue growth (TTM) 0.45% 28.50% 3.21%
EPS growth (last fiscal year) 50.71% (99.59%) (8.44%)
Revenue growth, 5-year CAGR 16.62% 19.69% 12.97%
Net income growth, 5-year CAGR 0.00% (57.68%) 0.00%

Health

Metric CAR HRI Rental & Leasing Services median
Debt to equity (7.67) 4.24 1.48
Current ratio 0.81 1.10 1.36
Net debt to EBITDA 5.37 4.61 4.32

Dividend

Metric CAR HRI Rental & Leasing Services median
Dividend yield — 2.30% 1.56%
Payout ratio — 1.90 0.22

Size

Metric CAR HRI Rental & Leasing Services median
Market cap 3.88b 4.15b 2.43b

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