The ongoing interval is a grand recovery period for most stocks in the market that had gone almost into hibernation due to the COVID-19 pandemic in 2020. One such stock which had a grander than expected comeback in 2021 was Avis Budget Group (CAR: US), and the streak is continuing in 2022 as well.
Avis was founded in 1946 when its founder Warren Avis opened a car rental area at an airport. Present-day, Avis operates in more than 11,000 branches in almost 180 countries around the world. The company’s stock, $CAR, kicked off 2020 at a closing price of $35.44 which shot up all the way to $357.17, the stock’s closing price on November 02, 2021. As of the moment, the American company holds an M. Cap. of 15.22 B USD.
Hefty Price Rise Post Buyback Plan
On March 15, 2022, the Board of Directors at Avis green-flagged a repurchase program for $1 Billion worth of shares. This is the most recent buyback program put into effect by the company. According to Avis’s SEC filing, the company has almost $1.16 billion worth of buyback authorization still left standing.
The same day as the repurchase bulletin, $CAR opened at $215.86, and later went on to see prices jumping. Two days later, the stock closed at $298.00 on March 17, 2022. This signified a rise of almost 38.05% in just two days.
Well Backed Up
$CAR had a headstart to the year, closing at $202.22 on January 3, 2022. Post this, however, the stock took a dive closing on as low as $149.52 on February 23, 2022, just nine days after its earnings announcement.
On February 14, 2022, Avis unveiled its financial results and earnings for the Fourth Quarter of and as well as the full-year of 2021. Revenues earned in Q4 2021 were estimated to be 90% higher than the revenues for the same period in 2020. Despite the stellar earnings, the company gave a few pointers in the ‘Forward-Looking Statements’ section:
“Various risks that could cause future results to differ from those expressed by the forward-looking statements included in this press release include, but are not limited to, the severity and duration of the COVID-19 outbreak, which is expected to continue to have a significant impact on our operations.” Additionally, the company divulged that it had also repurchased an amount of 2.6 million shares back in Q4 2021.
Less than a month back, $CAR closed at $167.76 on February 24, 2022, a value that was almost a 12.2% surge compared to its price the previous day. The following day, it stepped higher by closing at $180.01. The underlying reason for these price jumps was most likely the imposing of a new Californian Law: auto-rental agencies have the chance to add on more fees, given that an individual absent during the initial agreement is found driving the rented vehicle.
This plethora of positive announcements from Avis is steering its stock in a bullish direction. With travel bans being gradually lifted and a whopping repurchase pending, there is hope for the company to have an even better coming year than the one before.