Hertz Is Doubling Down on E-Commerce. Does That Make HTZ Stock a Buy Now?

Core Insights - Hertz's decision to allow buyers to complete the entire car purchasing process online aligns with the industry's shift towards digital buying habits, driven by consumer expectations for a seamless online experience [1][2] - The company has formed key partnerships, notably with Amazon Autos, enhancing its e-commerce presence and expanding its inventory visibility [1][2] - Industry forecasts indicate that by 2026, 15% of car purchases in the U.S. could be fully online, making Hertz's online strategy essential for improving resale outcomes [2] Financial Performance - Hertz's stock has increased nearly 64% over the past year and more than 50% since January, reflecting positive market sentiment towards its new strategy [4] - Despite the stock gains, Hertz reported a loss of $0.34 per share in the last quarter and a trailing yearly loss of $3.32 per share, indicating ongoing financial challenges [5] - The second quarter marked a turning point with core profits turning positive for the first time in nearly two years, with net income and adjusted EBITDA improving by approximately $500 million year-over-year [5] Operational Efficiency - The company's strategy of smarter vehicle management has led to a reduction in depreciation per vehicle to $251 per month, below its target of $300, and an increase in vehicle utilization to 83% [6] - Retail car sales reached a five-year high in the second quarter, suggesting that Hertz's digital sales initiatives are effectively engaging consumers [6] - Hertz has improved its financial position with over $1.45 billion in liquidity and a 3% reduction in direct operating costs [6]