Hertz Global Holdings, Inc.
Thesis
Hertz is expected to maximize shareholder value by leveraging HERC, using proceeds to pay down corporate debt, and spinning off HERC in a tax-efficient manner. This strategy is projected to lead to EPS accretion of $0.14 to $0.19 and a target share price of $36, representing a 52% upside from the current price.
Did it work?
The core structural events of the thesis did occur: Hertz completed the tax-efficient separation of its equipment rental business (spun off as Herc Holdings in June 2016), with Herc incurring debt and distributing cash to Hertz that was used to pay down corporate debt. However, the value-creation leg of the thesis — a re-rating to $36 (52% upside) on $0.14–$0.19 of EPS accretion — did not materialize; Hertz shares declined materially after the spin rather than approaching the target. With no price data provided and unknown elapsed time, the verdict rests on the thesis events themselves, and the mechanism played out while the promised upside did not.