The car rental space has been a hot favorite among the investors in the recent few years. It has also led to car rental companies’ stock rally to new heights. Hertz Global Holdings, Inc. (NYSE:HTZ) which is the largest publicly traded car rental company on the U.S. markets suffered a blow recently when it announced that its earnings reports for 2011, 2012 and 2013 had some glitches due to accounting errors and it will be re-reporting those results after making corrections. This led the company’s stock to fall and it still trades 2% lower than, it’s last year’s closing price.
“The stock has been held back, but at this point I think the company has gotten past many problems that kept it down. However, before getting into positives here, let me just take a moment to go over the accounting issues. I never want to minimize them or at least conceal some serious problems, hence while the stock did drop 9% when the news came out, but in Hertz’s case the accounting problems were like relatively small […] and several tax lawyers have assured me these were very minor in origin,” Cramer said.
Cramer also revealed that Hertz Global Holdings, Inc. (NYSE:HTZ)’s new CFO wants to perform all the reinstatements in the most meticulous way possible and the accounting firm that did Hertz Global Holdings, Inc. (NYSE:HTZ) accounting is a good accounting firm that would have stopped dealing with Hertz Global Holdings, Inc. (NYSE:HTZ) if they found there was a problem.
In addition, Cramer considers that the fact that Hertz Global Holdings, Inc. (NYSE:HTZ) is operating in an oligopoly market dominated only by three companies, will also play a big role in driving the stock price of the company higher.