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Hertz soars as top executives buy stock

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Car rental giant Hertz Global surged 12.6 percent Tuesday after reports that both the CEO and CFO bought shares of the company.

Chief Executive Officer John Tague reported the purchase of 66,000 shares of Hertz stock. Those purchases were made on last Friday and Monday, according to an SEC filing.

Chief Financial Officer Thomas Kennedy acquired 40,000 shares and Chief Revenue Officer Foland Jeffrey purchased 65,000 shares. Both transactions were made on Monday.

Hertz's shares were on course for its biggest one-day gain in about seven years. Shares of rival Avis Budget were also higher. That stock surged 3.8 percent, pacing for its best day since April 13, and a top gainer in the Dow Jones Transportation Average.

Hertz has been impacted by a worldwide decline in rental prices. Last Monday, Hertz reported a loss of $51 million in its first quarter. Despite the quarterly loss, the company backed its prior 2016 forecast.

Analyst Christopher Agnew of MKM Partners sees Hertz's outlook improving. Used car prices rose in April from the prices recorded in March, "which likely indicates that selling pressure from excess rental fleet in March has largely abated," Agnew said in a note to investors.

Hertz's stock has fallen nearly 58 percent in the last year. The stock's 52-week high was $21.31.

Hertz 1-year chart Source: FactSet