Hertz Global Holdings Inc (HTZ) Strikes Deal with Lyft, Uber

Hertz Global Holdings Inc (HTZ) is making slight gains after inking a deal with Lyft and Uber, but action in the options pits remains quiet

Jun 30, 2016 at 11:29 AM
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Hertz Global Holdings Inc (NYSE:HTZ) reported this morning that it had inked a deal with ride-hailing specialists Lyft and Uber that will allow both companies' drivers to rent Hertz vehicles for weeks or even months at a time. The agreement has the shares up 1.2% at $10.90, after HTZ dipped below breakeven earlier in the day.

Technically speaking, HTZ hasn't been much to write home about lately. The stock has shed 38% of its value year-over-year, hitting a six-year low of $6.95 in February. More recently, the stock's rally last week was stopped short at the $12 level -- home to peak call open interest in the July series. But it looks like the shares may now have found an ally in their 80-day moving average -- a trendline that served as resistance in recent months -- bouncing off of this level of support on Wednesday.

In light of the stock's lackluster technical performance, sentiment is mostly mixed across Wall Street. At the moment, four analysts rate HTZ a "buy" or better, while the remaining three give it a "hold." Meanwhile, short interest dropped by more than 9% in the most recent reporting period, but nearly 11% of HTZ's total float is still sold short.

Action in HTZ's options pits has been relatively quiet lately, too. While calls continue to outnumber puts on an absolutely basis, it looks like speculators have taken a more put-heavy approach than usual. Specifically, the stock's 50-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits higher than 69% of the past year's readings, at 0.65.

Today, HTZ options are crossing the tape at less than half their average intraday rate. For any trader eyeing a forthcoming breakout in the shares, however, now could be a great time to pick up short-term HTZ options. The stock's Schaeffer's Volatility Index (SVI) of 52% is lower than 81% of all readings in the last year, suggesting premium on short-term options is pricing in relatively low volatility expectations for Hertz Global Holdings Inc (NYSE:HTZ).

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