Avis Budget (CAR) closed Monday up 23.27% at $608.80, extending a run that has now pushed the stock up 374% year-to-date.
The move is the latest chapter in a short squeeze that has been playing out over recent weeks. More than 20% of the stock’s float is sold short, meaning every leg higher forces bearish investors to buy back positions — which in turn pushes the price even higher.
The squeeze has been running hot. Over the past week alone, the stock is up around 65%.
Beyond the short dynamics, there are real-world factors adding momentum. Widespread airport disruptions and TSA staffing shortages have pushed more travelers toward rental cars, tightening supply and giving companies like Avis stronger pricing power.
Geopolitical tensions are also in the mix. Uncertainty around US-Iran peace talks has kept crude oil prices elevated, which has made travelers consider ground transportation options — a tailwind for rental car demand.
Used car prices have climbed to multi-year highs, which directly benefits Avis. The company holds a large fleet of vehicles, and higher used car values increase the worth of those assets on the balance sheet.
That combination — tighter rental demand, higher fleet values, and a heavily shorted stock — has created a powerful cocktail for the move.
Not everyone is buying in. Barclays kept its “sell” rating on the stock, describing the rally as a “supply-demand mismatch.”
The bank pointed out that just two holders account for 71% of outright ownership, with over 100% of economic interest when outstanding swaps are included.
“All of this leads to uncertainty about how long this will last and whether CAR stock can go higher,” Barclays said.
The bank also said the rally cannot be justified even accounting for improvements in car market fundamentals.
The stock now trades well above most analyst price targets, a sign that technical trading forces are doing most of the heavy lifting here.
On the fundamentals side, Avis reported a net loss of $889 million for full-year 2025 — a 51% improvement from the $1.82 billion loss in 2024.
Revenue fell 1.6% year-over-year to $11.6 billion.
In Q4 2025, the net loss came in at $747 million, down 61.8% from the $1.96 billion loss in the same period a year earlier. Q4 revenue dipped 1.7% to $2.66 billion.
CAR’s year-to-date gain of 374% makes it one of the standout movers in the market this year.
Barclays’ warning aside, the stock closed Monday at $608.80.
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