Boston, MA 01/01/2014 (wallstreetpr) – Investor Daniel Loeb through his investment vehicle Third Point Capital initiated a stake in Hertz Global Holdings, Inc. (NYSE:HTZ). The hedge fund’s stake is valued at less than 5 percent of the U.S. No. 2 car rental company.
The activity of this hedge fund offers insightful information about the investment health of Hertz Global Holdings, Inc. (NYSE:HTZ) as a stock. Everyday investors who track hedge funds have typically outperformed their index-focused counterparts. This explains why we shout take a critical look at this latest activity on this stock.
Other stakes
The activities of hedge funds and insiders often help everyday investors to arrive at sound investment decisions. For this reason we can see that besides initiating a position in Hertz Global Holdings, Inc. (NYSE:HTZ), Third Point Capital is also holding other stocks such as Sony Corp where it has more than 7.4 percent stake.
With this position in Sony Corp, Third Point has been trying to lobby for restructuring of the electronics giant. It is particularly pushing for the spin off of the company’s entertainment business.
But for Hertz Global Holdings, Inc. (NYSE:HTZ), measures are being put in place to ensure that activist investors’ position on the stock does not interfere with the widely accepted management policies.
In addition to Hertz Global Holdings, Inc. (NYSE:HTZ) and Sony Corp, Loeb’s Third Point Capital also invested $1 billion in Softbank, the company that owns Sprint Corporation (NYSE:S), in November.
Investor reaction
Following the initiation of position in Hertz Global Holdings, Inc. (NYSE:HTZ) by Third Point Capital, the stock can be seen rising steadily this week. This indicates increase in investor confidence in the stock.
The stock is up more than 58 percent year-to-date through Tuesday. While this is a significant rise, it trails the stock performance of its rival Avis Budget Group which has almost doubled over the same period.
Dollar Thrifty takeover
Hertz Global Holdings, Inc. (NYSE:HTZ) and Avis were locked in a battle for the acquisition of Dollar Thrifty. The deal carried a value of $2.6 billion for the leisure market rental car company. Hertz Global Holdings, Inc. (NYSE:HTZ) has gained considerably through this acquisition.
