Hertz Global Holdings: Model Update: Pre-announced 2Q DPU Miss and Leverage Uptick Drive Estimates Lower; Maintain UW

Research evidence excerpt

Hertz Global Holdings: Model Update: Pre-announced 2Q DPU Miss and Leverage Uptick Drive Estimates Lower; Maintain UW

J P M O R G A N North America Equity Research

25 June 2026

Hertz Global Holdings Underweight

HTZ, HTZ US

Model Update: Pre-announced 2Q DPU Miss and Price (24 Jun 26):$3.00

Leverage Uptick Drive Estimates Lower; Maintain UW

Autos & Auto Parts

We are updating our model to reflect the softer than expected 2Q pre- Rajat Gupta AC

announcement yesterday (click here for our initial take) and the pricing of PIK (1-212) 622-6382

notes due 2030 announced this morning. Our conversations with investors pointed rajat.gupta@jpmorgan.com

to mounting concerns around financial leverage and a return to historical DPU Jash Patwa

uncertainty and variability, particularly as the guidance framework comes under (1-212) 622-5472

increased scrutiny. Management indicated that April used pricing and vehicle sales jash.patwa@jpmchase.com

trends were tracking in line with expectations and delivered gains on sale, but Yash Beswala

sequential pricing moderation into May (Manheim Rental Risk Index -2.7% m/m, (1-212) 622-0028

yash.beswala@jpmchase.com

Manheim Index +0.3% m/m) drove significant losses and prompted the DPU J.P. Morgan Securities LLC

guidance revision. Beyond this, management noted that travel demand remains

robust, RPD y/y growth accelerated vs. 1Q and is running ahead of initial guidance,

and improved fleet utilization has helped offset recall-related headwinds. At this Key Changes (FYE Dec)

stage, management does not see material implications for the moving pieces in Prev Cur Δ

2H26 guidance—HTZ’s latest guidance (from 1Q earnings in early May) calls for Adj. EBITDA - 26E ($ mn) 340 240 -29.2%

Adj. EBITDA - 27E ($ mn) 500 420 -16.0%

3–6% EBITDA margins for 2026.