Billionaire Bill Ackman Thinks Hertz Stock Could Reach $30 by the End of the Decade. Here's Why It Could Happen Sooner Than That.

Core Viewpoint - Bill Ackman, a prominent hedge fund manager, has invested in Hertz Global Holdings, leading to a significant increase in the stock price, with expectations of further growth by 2029 [2][3]. Group 1: Investment Rationale - Ackman believes that current tariffs could positively impact Hertz by increasing the value of its vehicle fleet, potentially adding $1.2 billion to its value due to a 10% rise in used car prices [5]. - The company operates a fleet of approximately 500,000 vehicles valued at $12 billion, and Ackman aligns with management's revenue targets of $1,500 per vehicle per month, suggesting achievable growth [6]. - If tariffs lead to higher rental demand, Hertz could increase rental prices and reinvest profits to enhance its fleet [7]. Group 2: Financial Projections - Ackman projects that by 2029, Hertz could generate $2 billion in annual adjusted EBITDA, valuing the company at $15 billion with a target share price of around $30 [8]. Group 3: Market Dynamics - Hertz's stock is heavily shorted, with about 50% of its float sold short, which could lead to a short squeeze if the stock price rises rapidly due to covering by short sellers [10][12]. - The potential for a short squeeze is heightened by Ackman's influence as an activist investor, which could lead to significant price movements following positive quarterly results [13]. Group 4: Current Investment Sentiment - Despite Ackman's involvement adding credibility, uncertainties remain regarding Hertz's ability to sustain growth and the long-term impact of tariffs, leading to a cautious outlook on the stock [14][15].