Hertz Global Holdings, Inc. (HTZ) stock is soaring 5.01% in pre-market trading on Thursday, continuing its recent rally following Bill Ackman's Pershing Square Capital Management's significant investment in the company. This surge comes on the heels of a dramatic week that saw HTZ's stock price more than double.
The catalyst for this remarkable upturn is Ackman's strategic acquisition of a 19.8% stake in the car rental giant, making Pershing Square the second-largest shareholder. This move has sparked intense investor interest and speculation about a potential turnaround for the company, which has faced financial challenges in recent years.
Adding fuel to the rally is the unique shareholder structure of Hertz. With Knighthead Capital Management already holding approximately 59% of the company and Pershing Square's recent stake, the public float has significantly diminished. This reduction in available shares has created a highly volatile trading environment, making the stock particularly sensitive to buying pressure and increasing the likelihood of a short squeeze.
While Ackman's vision includes an ambitious $30 price target for 2029 based on operational improvements and potential partnerships, the company still faces substantial challenges, including a $17.8 billion debt load. As the market digests this news, investors should be prepared for continued volatility in HTZ stock.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.