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Hertz Global (Nasdaq: HTZ), the leading car rental company, has had a difficult past few years. But on Tuesday, Hertz stock had its best day in quite a while as the firm surprised investors and analysts with its third quarter results.

Hertz stock has been in freefall over the past four years or so, dropping down into penny stock territory to below $3 per share in late 2024. The stock price surged in April to over $8 per share after it was reported that it got a major investment from noted hedge fund manager Bill Ackman and his firm, Pershing Square Capital Management.

The stock price steadily sank after that jolt back to around $5 per share, but on Tuesday, it shot 41% higher after third quarter earnings showed that the turnaround was taking root. Specifically, the company was profitable for the first time in two years.

• Revenue: $2.5B, down 4% year-over-year. This beat estimates of $2.4B.
• Net income: $184M, up from a $1.3B net loss in Q3 of 2024.
• Earnings: 42 cents per share, up from a $4.24 per share loss a year ago.
• Adjusted earnings: 12 cents per share, up from a 68 cents per share net loss a year ago. This beat analyst estimates of 7 cents per share.

Course correction

It marks what the company hopes is the beginning of a turnaround. The stock, as mentioned, had been in freefall after a massive bet on EVs, adding 100,000 Teslas and other EVs to its fleet, failed to pay off.

The company corrected course with its “Buy Right, Hold Right, Sell Right” fleet strategy, selling off the EVs and replacing them with more in-demand gas-powered vehicles. It also focused on buying new cars at competitive prices and selling off older vehicles through its direct-to-consumer platform.

It took some time, but this strategy has helped Hertz lower its depreciation per unit and operating expenses to the point where it has improved earnings. In Q3, expenses plummeted to just $2.2 billion, down from $4.2 billion in Q3 2024. Through the first nine moths of 2025, expenses have dropped to $7.1 billion from $9.7 billion in the same period last year.

“This quarter proves that we’re delivering on our commitments: driving strong results through focused execution and operational discipline,” Gil West, CEO of Hertz, said. “Throughout this transformation, we’re rebuilding our foundation while sharpening our skills and capabilities, creating a new platform for growth. Our progress is meaningful, our heads are down, but our eyes are on the horizon as we build a company that can thrive across the full spectrum of mobility.”

With the fleet refresh now complete, it should put Hertz on solid footing for future growth. The company is targeting $1 billion in EBITDA by 2027, and currently its EBITDA is at $190 million, so that would be an impressive plateau, if reached.

After Tuesday’s meteoric 41% rise, investors may want to hang back a bit and wait for the dust to settle. The results should cause some analysts to rethink their price targets for Hertz stock.  

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