Key Stats for Avis Stock
- Price change for Avis stock: -9%
- $CAR Stock Price as of Mar. 30: $136
- 52-Week High: $213
- $CAR Stock Price Target: $106
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What Happened?
Avis (CAR) stock dropped 9% on Monday after the company disclosed on Friday that it entered into an agreement to sell up to 5 million new shares through a group of major investment banks, including Bank of America, J.P. Morgan, Morgan Stanley, and Wells Fargo.
- The move is known as an at-the-market offering. It lets a company sell new shares gradually into the open market rather than all at once.
- Avis said it plans to use the proceeds for general corporate purposes and can pause or cancel the program at any time.
The timing is notable.
- Avis stock had surged sharply in the days leading up to this announcement, making Monday’s pullback look like a classic case of investors selling into the dilution news after a strong run.
- Dilution is the key concern here.
- When a company sells new shares, existing shareholders own a smaller piece of the business. With 5 million shares potentially hitting the market, investors are pricing in that risk.
The backdrop for Avis isn’t simple.
- The company had a difficult 2025, missing its full-year EBITDA guidance by about $150 million.
- The miss was driven by a sharp drop in demand in November, tied to government travel slowdowns, FAA disruptions, and weather events.
- Used vehicle prices also fell sharply at the worst possible time, pushing depreciation costs well above expectations.
New CEO Brian Choi was direct about the miss on the company’s most recent earnings call.
- He offered no excuses, called the result unacceptable, and laid out a clear plan to fix the business in 2026.
- The plan centers on running a tighter fleet, improving vehicle utilization, and cutting costs in areas that don’t generate returns.
- The company also wrote down roughly $500 million on its EV fleet at year-end, which was a deliberate reset to reduce future volatility.
- Management said the move was necessary given shifting EV economics and helped unlock $180 million in tax credit monetization.
For 2026, Avis guided to adjusted EBITDA just in line with the 2025 full-year number, which management acknowledged reflects ongoing uncertainty in the business.
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What the Market Is Telling Us About Avis Stock
Avis stock has been under pressure for much of the past two years, and today’s drop is a reminder of how quickly sentiment can shift.
The share issuance announcement turned a strong week into a painful Monday.
That said, if Avis can execute on its fleet rightsizing plan and stabilize depreciation, the stock could look cheap at current levels.
The Waymo partnership in Dallas is also worth watching as a potential longer-term catalyst.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
