Avis Budget (CAR) Up 3.8% Since Last Earnings Report: Can It Continue?

A month has gone by since the last earnings report for Avis Budget Group (CAR). Shares have added about 3.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Avis Budget due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Avis Budget Group, Inc. before we dive into how investors and analysts have reacted as of late.

Avis Budget Reports Q4 Earnings Miss

Avis Budget Group (CAR) reported unimpressive fourth-quarter 2025 results, with both earnings and revenues significantly missing the Zacks Consensus Estimate.

The company announced a fourth-quarter adjusted loss of $6.53 per share, which was 2151.7% and 2739.1% wider than the consensus estimate and the year-ago reported figure, respectively. Revenues of $2.66 billion missed the consensus mark by 3% and declined 1.7% from the year-ago quarter.

Weak demand for rental cars with lower rental days, especially in the United States, resulted in reduced gains on vehicles sold and a lower valuation mark on CAR’s retained fleet during the fourth quarter. Additionally, the declining rental index price per vehicle metric, especially in November 2025, hurt the company the most, leading to the steep bottom-line dip.

Avis Budget’s Segmental Revenues

Revenues from the Americas amounted to $2.04 billion, reflecting a 3.6% decline from the year-ago quarter’s reported figure. The metric lagged our estimate of $2.13 billion.

International revenues were $624 million, increasing 5.2% year over year and beating our estimation of $612.1 million.

CAR’s Profitability

Adjusted EBITDA was $5 million against a loss of $101 million in the year-ago quarter. The Americas segment reported adjusted EBITDA of $1 million. Internationally, adjusted EBITDA was $21 million.

Key Balance Sheet & Cash Flow Figures

Avis Budget exited the fourth quarter of 2025 with cash and cash equivalents of $519 million compared with $564 million at the end of the third quarter of 2025. Corporate debt was $6 billion, flat sequentially.

CAR generated $437 million in net cash from operating activities during the quarter. The adjusted free cash flow utilized was $119 million. Capital expenditure was $82 million.

Q1 and 2026 Guidance

CAR expects fleet costs per month to be $400 per unit for the first quarter of 2026 and between $320 and $330 per unit for full-year 2026. The company guided EBITDA to be between $800 million and $1 billion for 2026.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a downward trend in estimates revision.

The consensus estimate has shifted -120.3% due to these changes.

VGM Scores

Currently, Avis Budget has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock has a grade of A on the value side, putting it in the top quintile for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Avis Budget has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.

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Avis Budget Group, Inc. (CAR): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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