AVIS RALLY OPENS RECORD GAP BETWEEN SHARE PRICE, TARGETS

The crippling supply problem of the auto industry has turned out to be a boon for rental car companies. A breakneck rally in the shares of Avis Budget Group Inc. over the past month has driven the stock to record its biggest gain over Wall Street analysts’ average price target since at least 2006. The shares have risen 239 per cent this year, dwarfing the S&P 500 Index’s 15 per cent advance. The pace of the rally has quickened over the past month, with a 37 per cent jump. The rental car industry has found itself in an advantageous position as the production of new cars has remained tight amid a global supply-chain shortage. At the same time, demand for personal vehicles surged with the economy gradually reopening and travel resuming after prolonged pandemic-related shutdowns.