UPDATE: Avis Budget Group (CAR) Likely to Reach New Daily Rate Highs, PT Raised to $85 at Morgan Stanley
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Morgan Stanley analyst Billy Kovanis raised the price target on Avis Budget Group (NASDAQ: CAR) to $85.00 (from $73.00) following evidence of car shortages, price increases & a resurgence of travel demand. The analyst sees this translating into pricing power that could reach a record of $68/day.
The analyst reiterated an Equalweight rating, stating "At the beginning of 2021, the potential for Avis to generate $1bn of EBITDA by 2023 was seen as unlikely, whereas now it has become Consensus. Similarly, while Consensus is currently only at ~$780mm Adj EBITDA for 2021, largely unchanged since Q1 earnings, pricing has only gone up each month since Q1, as evidenced by CPI rental car data (Exhibit 3) being up 10% in the last month, up over 50% since the beginning of the year and up over 100% YoY... This is reinforced by many anecdotes of people paying exorbitant prices to get their hands on a rental car (if they can even get a car)."
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change, Hot Comments
Related EntitiesMorgan Stanley, Raising Prices, Earnings
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