A trio of 1st year students at Columbia Business School took home a $100,000 cash prize this past week at the annual Pershing Square Challenge after presenting their pitch on Hertz Global Holdings (NYSE: HTZ). Two of the presenters are members of SumZero.
With explicit permission from the winning team, their 90-page pitch deck is now available to the SumZero community here:
Download Hertz Report: Winner of the Pershing Square Challenge
We recommend investors buy Hertz shares with a 12-month target share price of $36, which represents ~52% upside to the current share price. There are four main points to our investment thesis: 1) The market significantly underestimates the impact of Hertz's recent merger with Dollar Thrifty on car rental pricing; 2) The market underestimates the levers Hertz can pull to counter the negative impact of falling used car prices; 3) Hertz has strong growth opportunities in the U.S. and will realize significant revenue and cost synergies through its acquisition of Dollar Thrifty; and 4) A divestiture of the non-core Equipment Rental segment would unlock substantial value by deleveraging the balance sheet.
The Winning Team:
Stephen Lieu is a first-year MBA student at Columbia Business School, focused on investment management. Prior to Columbia, Stephen worked for four years in investment banking and private equity. Stephen received a B.S. in Economics from the Wharton School, University of Pennsylvania.
Rahul Raymoulik is a first-year MBA student at Columbia Business School, focused on investment management. Prior to Columbia, Rahul was a Sector Specialist at Fidelity Investments. Rahul received a B.S. in Information Science from Northeastern University and an M.S. in Finance from Boston College.
Richard Hunt is a first-year MBA student at Columbia Business School, focused on investment management. Prior to Columbia, Richard was a Senior Financial Analyst at New Constructs. Richard received a B.B.A. in Economics and Finance from the University of Kentucky.
The SumZero Team