Hertz Stock Pops 70% on Buyout Speculation Today
Shares of Hertz (NYSE: HTZ), the bankrupt vehicle rental company, jumped over 70% on buyout speculation Wednesday morning.
It's been widely covered that Hertz and its massive $19 billion pile of debt will likely leave current shareholders with nothing. That said, the bankruptcy process can play out in many ways. And now Jefferies analyst Hamzah Mazari noted that large used-car retailers CarMax (NYSE: KMX) and AutoNation (NYSE: AN) could be positioned to jump in, possibly purchasing a 150,000 vehicle chunk of Hertz's fleet to generate cash and help satisfy some lenders. Mazari believes the sale could generate roughly $3 billion and be beneficial for Hertz, which he anticipates will have only $365 million cash on hand by the end of this month. The company had roughly $1 billion cash on hand when it filed for bankruptcy on May 22, 2020. Simply put, the longer the bankruptcy process drags on, the fewer options the company will have and the more desperate it will be to give rivals and other entities opportunities.
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Source Fool.com
