Unusual Whales

Avis Budget Group Inc. (NASDAQ:CAR) Continues Soaring Following Earnings Report amid Rental Car Boom

Unusual Whales -
  • Avis Budget Group Inc. (NASDAQ:CAR) surges 185.76% higher this morning
  • This follows news of rental car boom and stellar earnings for the company
  • Avis Budget Group Inc. is up over 1,200% year to date

Shares of Avis Budget Group Inc. (NASDAQ:CAR) traded $318.50 higher this morning amid an ongoing rental car boom (one that, in addition to Tesla news, also pushed rival Hertz up by a factor of 34%). At $489.96 per share, this was a 185.76% increase on the day, resulting in numerous upward volatility trading halts. This marks the second day in a row that CAR has surged in price as traders continue to accumulate shares. In addition to the heavy increase in demand for rental cars, Avis Budget Group also reported their quarterly earnings after market close on Monday November 1st.

After a stellar earnings report last quarter, expectations were high for CAR going into their aftermarket report. Earnings per share this quarter were expected to total $6.68, and the revenue forecast was USD$2.78B. Needless to say, CAR shattered market expectations again, with a reported earnings per share of $10.74 (a 60.89% surprise) and revenue of USD$3B (an 8.10% beat). As the stock price soars, it’s worth noting how the options order flow on Unusual Whales compares.

On November 1st, 2021, one day before CAR reported earnings, options activity captured by the Unusual Whales flow tool displayed mixed sentiment for the stock, with bullish and bearish premiums neck and neck. At the time, CAR was already in the first stages of its surge upward, and traded in a window between $171 and $174 throughout the day. Bullish options traders focused primarily on slightly out of the money call contracts ($175 call strike) with a November 19th, 2021 expiration date. The options flow captured by Unusual Whales following earnings, however, showed a much more bullish expectation by traders.

As the CAR share price broke the $400 line, options traders piled on to the deep in the money $110 call strike and the newly in the money $240 call strike, both expiring November 19th, 2021. The bearish versus bullish premium ratio also jumped from yesterday, with 61.7% of all options premiums spent flagged as bullish by the Unusual Whales flow tool.

CAR continued to surge upward from there. Options trader focus shifted to the $170 call strike expiring November 19, 2021, with over USD$2.4M in premium flowing in right before yet another upward halt.

As of the morning of November 2nd, 2021, shares of Avis Budget Group, Inc. traded as high as +186% ($489.96 per share) on the day, and 1,282.51% year to date.