CAR Stock Forecast & Price Target

Avis Budget Gr is viewed positively because the business continues to show resilient demand, with average rent at all-time highs and recurring FFOPU of about $0.654 coming in near expectations despite softer year-over-year growth in SP NOI of 0.9% and SSNOI of 0.9%. The outlook also reflects a belief that the company’s strategic priorities remain intact under the new CEO, with management focused on occupancy, operational streamlining, and balance-sheet discipline, while favorable market conditions should eventually help convert above-market leases and improve rent growth as elevated incentives work through the system. Although 2026 estimates were revised lower due to higher incentives and slower revenue growth, the stock still appears reasonably attractive versus history on AFFO and implied cap rate spread, and the analyst expects more meaningful upside to fundamentals as higher turnover and lease resets gradually reset pricing power.

Avis Budget Gr is weighed down by deteriorating operating fundamentals, including downward revisions to 26E new lease spreads, a ~40% increase in 26E incentives to $16M, and reduced 26E SSREV growth from 2%-3% to 1%-2%, all of which point to weaker pricing power and softer revenue momentum. The negative outlook is reinforced by excess supply in key markets, record-low or negative new lease spreads, and the expectation that pressure from short-tenure leases and incentives will persist for 9-12 months, limiting margin expansion while Opex is still expected to rise 2%-3%. Although the company still carries an intact $48 NAVPU and there is some longer-term upside if lease spreads normalize, investors are likely to stay cautious until there is clearer evidence of sustained recovery in market rents, incentives, and strategic execution.