TLDR
- CAR stock surged 10% to $235, driven by heavy call buying and short squeeze dynamics
- The stock is up 118% over the past month, with a thin float of just 13.05 million shares
- Hertz (HTZ) rose 8% to $5.70 on the same options-driven momentum
- Wall Street remains bearish with a consensus “Reduce” rating and an average price target of $115
- Avis reported a Q4 FY2025 EPS of -$21.25, weighed down by a $518M EV impairment charge
Get live prices, charts, and KO Scores from KnockoutStocks.com, the data-driven platform ranking every stock by quality and breakout potential.
Avis Budget Group (CAR) had a wild Tuesday. The stock moved from $212.60 to as high as $235 in midday trading — a 10% jump fueled almost entirely by options activity and short squeeze mechanics.
It’s the latest chapter in a month-long run that has seen CAR gain 118% heading into today’s session. The stock also hit a fresh 52-week high of $214.84 before pushing even higher.
Hertz (HTZ) joined the rally, climbing 8% from $5.31 to $5.70 on similar call buying activity. The two rental car names move together often — same sector, same debt-heavy structure, same short interest profile.
The setup in CAR is textbook squeeze territory. When heavy call buying hits a thinly traded stock, market makers have to hedge by buying the underlying, which pushes the price up, which attracts more traders, which creates more hedging pressure. Repeat.
CAR has a float of just 13.05 million shares and only 35.26 million shares outstanding. That’s a small pool. When short interest collides with aggressive call buying in a name this tight, the moves can be violent.
What the Bulls and Bears Are Arguing
The bullish case is simple: momentum, historical squeeze patterns, and a belief that the pain trade is still higher.
The bears have more data. Avis reported a Q4 FY2025 EPS of -$21.25, a massive miss against the -$0.23 estimate. The company carries $6.1 billion in corporate debt and has negative shareholders’ equity of -$3.129 billion. A $518 million EV impairment charge hit the quarter hard.
Wall Street’s analyst consensus sits at “Reduce” with an average price target of $115 — less than half today’s trading price. Goldman Sachs has a $85 target. Morgan Stanley is at $97. Barclays cut to $95. Deutsche Bank moved to Hold with a $128 target.
That disconnect between price and analyst targets is exactly what’s keeping the squeeze alive. Bears staying short means they’ll eventually need to buy shares to cover — and that’s free fuel for the bulls.
Insider and Institutional Activity
Not everyone is running from the stock. Pentwater Capital Management bought 425,000 shares in February at an average of $94.26 per share, a transaction worth $40 million and an 11.9% increase in its position.
Insiders own 52.8% of the company, and institutional ownership sits at 96.35%.
In a separate move, Avis announced an at-the-market equity offering allowing it to sell up to 5 million shares — a deal that previously knocked the stock 10% when announced.
Avis’s 50-day moving average is $116.57 and its 200-day moving average is $130.71, both well below current trading levels.
The stock has a market cap of $7.50 billion and a beta of 1.94, reflecting just how volatile this name can be.
Considering a new stock? You may want to see what’s on our watchlist first.
Our team at Knockout Stocks follows top-performing analysts and market-moving trends to spot potential winners early. We’ve identified five stocks gaining quiet attention that could be worth watching now. Create your free account to unlock the full report and get ongoing stock insights.
