In Monday’s Sector Trade - the rental car trade. Morgan Stanley is taking down the entire space with downgrades right at the top of the summer driving season. Should you be buying or selling?
Jeff Macke says rental car companies have rising expenses and no real pricing power. He explains that the auto industry is no longer offering companies, such as Hertz (HTZ) and Avis (CAR),fleet sales and that, Jeff says, bodes well for General Motors (GM) and Ford (F).
Jeff thinks the trade is to get incrementally more bullish on car makers and sell the rental companies.