Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Going to jump on tomorrow if I can get it low
Until the gets off the OTC and on an exchange it probably will have some swings so it will be unpredictable.
Even the Bid/Ask spreads are a bit nutty due to the OTC.
Good buy down here??? Or maybe some lower? Thanks
Is HTZZ Nasdaq bound ?
It certainly would explain why the company did not uplist immediately upon exiting BK.
NASDAQ usually takes 4-6 weeks.
https://nypost.com/2021/05/19/hertz-insiders-dreaming-of-nasdaq-listed-ipo-sources/
Thank you very much!
If you sell the warrant it is just like selling a share of stock....you receive the value in dollars. Someone else , or entity, is actually buying the warrant from you.
Easy and done online.
If you exercise the warrant you have to contact your brokerage and ask to exercise it and then they will start the process of exercising and buying common shares based on the exercise price.
By the way I plan if I ever sell down the road to convert it to HTTZ. Just curious to know
Quick question and please forgive me I never had warrants before.
I use TD Ameritrade and have 1000 warrants.
Let’s say I sell just one warrant at its current price at 8.70, can I just sell it and keep the 8.70 or do I have to buy HTZZ.
Just confused, I have no plans on selling for manny years but just trying to learn.
The trend right now is BK players cashing in their NEWCO conversions.
This became a Reddit favorite and garnered more interest than almost any other Ch11 play ever just because it happened during the lockdown.
It might take a while to clear these folks out who really aren't interested in any longer term holding of the NEWCO.
One thing is for certain.....the private equity groups that invested billions ain't in it for a sub $20 stock price.
The day after day trend of both are crappy right now. HTZZW might be the safer way to go, but if things turned around long term, more upside with HTZZ.
Am I better off selling the 200 shares I have in HTZZ and buying 400 warrants?
I think the fact that the HTZZW volume is about 100% greater than HTZZ today shows that BK recipients are liquidating their newco holdings.
Retail for the most part didn't invest in Hertz as much as were looking to get a decent return if commons survived.
But in this case they ended up with more warrants than shares.
Just averaged down. hate saying that, but yes, it will get more attention when it moves over. the bleeding should slow or stop soon.
Volume has fallen off a cliff.
Being on the OTC is not doing holders any favors.
CAR has an average volume of over 1mm a day.
Last few days HTZZ isn't even getting 50% of that.
This needs to move back to an exchange sooner than later.
Hertz warrants.... pricing is all about the implied volatility
Avis (CAR) is better than 50% but somehow they seem to be pricing HTZZW at 15-20%....which is incredibly low.
Like really, really low.
Even the S&P500 has a higher volatility.
If that ever corrects to a more normal volatility this things jumps big.
You think so? I saw your comment about it few days back.. picqued my interest. Just watching and researching for now. TIA
When HTZZ and HTZZW get off the OTC and move onto an exchange this thing is going to see a nice steady climb similar to CAR.
Oops probably $20 before $10 instead -
Thanks for the reply. I am looking to if I can around $17 maybe. Almost bought today at $18 lol
It's not going to $10....lol.
As the BK players clear out and cash in their shares and warrants this will swing some but not that low.
It’s already $20?
I think thats reasonable. $10 before $20.
According to the article they haven't even started to short HTZZ yet. And PE of 12 is too high, should be about 6. Look for another 50% haircut so $10 - overreaction could take this to $8 temporarily.
Might want to read this...the stock won't parallel the warrants present value. Hertz announced the strike price of $13.80
From Barron's yesterday.
Investors Should Pay Attention to Hertz’s Warrants. They Are a Cheap Way to Play the Company’s Revival.
Warrants are an unusual financial instrument, and they accounted for the bulk of the value received by shareholders of Hertz Global Holdings as part of its emergence from bankruptcy last week.
These warrants have landed in brokerage accounts and many individual investors are befuddled by them. Some are selling the warrants (ticker: HTZZW), which continue to trade inexpensively relative to Hertz’s new equity (HTZZ).
Barron’s wrote favorably last Friday on the warrants as an alternative to new Hertz equity because investors were then valuing the warrants below their intrinsic value—a very unusual occurrence that surprised derivatives experts. They still look like a cheap alternative to the stock.
Hertz shares were down 35 cents, to $21.40, in trading Wednesday, while the warrants dropped 69 cents, to $9.30.
Here’s what investors ought to know about the warrants.
The warrants are a long-term call option that give holders the right to buy Hertz stock for 30 years at a price of $13.80 a share, an exercise price that the company recently confirmed.
Berkshire Hathaway CEO Warren Buffett is a fan of warrants and has received them on several financing deals including a $10 billion investment in Occidental Petroleum (OXY). Occidental also has publicly traded warrants (OXY/WS).
Shareholders of old Hertz got $1.53 a share in cash, roughly a 0.09 share of new stock and about 0.64 of a warrant for each old Hertz share, the company confirmed. The warrants accounted for about 60% of the value of the package.
The Hertz warrants are attractively structured because of their long maturity of 30 years—the Occidental public warrants had an original maturity of seven years—and other features. Investors like long-dated warrants since it provides more time for the stock to appreciate and benefit warrant holders.
The Hertz warrants have other appealing features including what’s called anti-dilutive protection in case the company pays dividends to shareholders. This likely means that the exercise price of the warrants will be adjusted downward if dividends are paid. The warrants also protect holders if Hertz is taken over for cash.
With Hertz trading at $21.40, the intrinsic value of the warrants is $7.60 ($21.40 less the exercise price of $13.80), meaning investors are paying an effective premium of $1.70 (the current warrant price of $9.30 less $7.60) for the time value of the warrants. That’s low.
Pros often value warrant and options based on the underlying volatility of the stock. Assume a 25% annualized volatility on Hertz stock—roughly half of the volatility in options on Hertz rival Avis Budget Group (CAR)– and the warrants would have traded earlier today around $16.
Pros say that holders generally shouldn’t exercise warrants and get stock since the warrants are likely to continue to trade at a premium to their intrinsic value.
The warrants should offer investors most of the upside in Hertz stock while providing considerably more downside protection.
The warrants may be trading cheaply because many more of them were issued to old Hertz shareholders—88 million warrants against an estimated 14 million shares of stock. Hertz now has 471 million total shares outstanding with the bulk held by institutions, including the investor group led by Knighthead Capital and Certares Management, which won a bidding war for control of Hertz in bankruptcy court.
The vast bulk of that institutional stock isn’t freely tradable yet. For that reason, trading volume in the warrants Tuesday exceeded that of the stock with over four million warrants traded against under two million shares of stock.
It’s also difficult — if not impossible — to borrow Hertz stock now. That means derivatives pros can’t buy the warrants and hedge themselves by selling short the stock.
Hertz is now valued at about $10 billion, nearly double that of Avis.
Hertz does have a stronger balance sheet than Avis and is expected to have emerged from bankruptcy with little or no net corporate debt, against about $3 billion of net debt at Avis. Hertz, Avis, and the private Enterprise dominate the U.S. rental car industry and they’re cleaning up this summer thanks to a vehicle shortage and strong demand that is leading to record pricing.
Bulls like Jefferies analyst Hamzah Mazari have argued that the industry is changed for the better with a functional oligopoly that likely will lead to better pricing discipline once the vehicle shortage eases.
Hertz management this spring projected $859 million in 2023 Ebitda, or earnings before interest, taxes, depreciation, and amortization. That means Hertz now trades for 12 times that figure, not a cheap valuation. That estimate, however, could prove low given favorable industry trends. Hertz had the lowest margins and the least pricing discipline in the past among the big three in rental cars. That could change.
As for the warrants, once Hertz stock becomes more liquid and can be shorted, it is a reasonable bet that the warrants outperform the stock. That’s one reason why the warrants look like an inexpensive play on Hertz’s revival.
Write to Andrew Bary at andrew.bary@barrons.com
I believe you are still seeing Ch 11 equity holders selling off their conversion and taking profit.
Most didn't invest in BK shares as a long term hold....BK players rarely do. Especially so when commons survive in some form.
Based on the returns CAR has seen over the last year....and with Hertz company in a phenomenally better financial position....it would not surprise me to see this eventually head north to higher levels in the coming weeks.
Just a guess of course but it has been my observation it takes a little time for emerging BK companies to clear out the temp players
Down-another-7-8%-so-far-today;IDK if it'll-go-that-low but waiting/watching, def. not ready yet IMO. Another one to watch is CC-l carnival cruise line, analysts said couple days ago if it didn't hold 25 support it could go back down to 18 and it's around only 24 now.
What’s everyone think price potential here long? Thanks
They were going to give a strike price of $5 to the warrants so likely thats where HTZZ is going. Probably even less.
There wasn't one. Just a replacement, with old shares cancelled. 10 old HRTZQ for 1 new HTZZ and $1.53 cash + 0.6 warrants which they haven't given a value to yet.
Buying e dip. Plan to retire in this bb
Why Hertz’s Warrants Look More Attractive Than Its Stock (7/02/21)
By Andrew Bary
Newly issued warrants from Hertz Global Holdings appear inexpensive based on the stock price of the reorganized rental-car company and look like a cheaper play.
The 30-year Hertz warrants (ticker: HTZZW) were trading at $11.75, down 20 cents on Friday, while new Hertz stock (HTZZ) was off 99 cents, at $26, in midday trading Friday. The warrants and new stock in Hertz began trading over the counter Thursday after the rental-car company exited bankruptcy on Wednesday.
Based on an estimated exercise price of about $13.80 on the warrants, they trade below intrinsic value of $12.20 ($26 minus $13.80), which is befuddling derivatives traders on Wall Street. The theoretical value of the warrants assuming underlying annual volatility on Hertz shares of 25% is estimated around $20.
The warrants look like a more attractive play on Hertz than the stock. The warrants are structured with a very long maturity of 30 years, against an original maturity of seven years for one from Occidental Petroleum (OXY/WS). The long maturity should increase their value.They also protect holders in case Hertz pays dividends to common holders as well as takeover protection in the case of a cash deal.
Hertz stock had a strong debut Thursday as investors enthused over strong pricing in the rental car market this summer amid a vehicle shortage. AAA estimates that rental pricing is up 85% year over year. Hertz is getting $275 a day for SUVs in popular markets, compared with an average vehicle rate of under $50 in the first quarter.
The company exited bankruptcy carrying a strong balance sheet with little or no net corporate debt. The company is now valued at around $12 billion, more than double that of rival Avis Budget Group (CAR), whose stock was down 1.5% at $80.63.
The seemingly low price on the warrants could reflect several factors. Hertz has yet to officially confirm that the strike price is $13.80. It’s believed to be very difficult or impossible to short new Hertz stock, meaning that arbitrageurs can’t buy the warrants and short the stock.
It’s also possible that the new stock is overpriced and that the warrants may be indicating a truer value for the company. Some institutional trading in unregistered Hertz stock apparently occurred Thursday at a discount to the public market.
The bulk of Hertz’s estimated 471 million shares outstanding are held by the group led by Knighthead Capital and Certares Management that took Hertz out of bankruptcy, as well as other institutional investors. These buyers paid $10 a share for their Hertz stock.
There are an estimated 85 million to 90 million new warrants outstanding that were given to Hertz’s old shareholders as part of a package that also included cash and new stock.
Hertz’s restructuring statement notes that the exercise price of the warrants is a $6.5 billion equity value for the company divided by the company’s shares outstanding, which are about 471 million, Barron’s estimates based on other disclosure information.
“Our strategy team looked at the terms and estimates that the HTZWW strike price for will come in at ~$13.80,” Susquehanna Financial Group told Barron’s in an email. “We are not focused on warrants, we are focused on listed equity, index, and ETF options, but we looked at the warrant terms.”
Old Hertz shareholders who held stock under the HTZGQ ticker are due to receive a package of cash, new stock and warrants.
The cash portion is $1.53 per old share. Barron’s estimates that old holders will get nearly a tenth of a share of new stock and almost two-thirds of a warrant per old share. That package is worth about $11 a share based on the old stock, Barron’s estimates, compared with a closing price of $8.74 Wednesday.
Here is what Hertz said in one of its restructuring documents about the warrants:
“The exercise price (as the same may be adjusted from time to time, the “Exercise Price”) for each Warrant Share shall be equal to (i) a total equity value of $6,500,000,000 of the Issuer (“Strike Equity Value”) divided by (ii) the number of Reorganized Hertz Parent Common Interests issued under the Plan on the Effective Date.”
https://www.barrons.com/articles/why-hertzs-warrants-look-more-attractive-than-its-stock-51625246445
I started buying this stock when I rented a car last year in the summer and they were up to their necks with work. I asked the workers at Hertz and they all said they were doing very well. It wasn’t easy to add 2+2 with their offices all over the country. I did well but didn’t sell this thing will rebound several times.
It is typically best to sell. Just got lucky in this case! Congrats! I have never posted here before so it wasn't me that told you to sell lol!
Lucky dog! Congratulations!
My 576 shares @ $1.03 converted to- HTZZ 52 shares @ $29.80, 372 HTZZW Warrants @ $10.48 & $834 cash for $5,967 current value. Glad I didn't sell like certain people claimed was best.
Thx. This=trading on TDA but not all platforms,e.g. Merrill-Lynch still isn't. They also weren't allowing buying, only selling, of old HTZGQ.
The conversion was $1.53 + 0.1 share of new company + 0.6 warrant to purchase new company shares at $5 per share. Seems that the warrants make the deal worthwhile to the old HRTZQ holders.
How does this PPS-compare-to-HTZGQ?-What was the conversion? Usually when there's a change despite getting out of BK there's an initial drop so peeps wary I guess, I sold my shares a couple weeks ago. The charts don't include HTZGQ so they're just 2 days old now.
$HTZZ: I can't believe no one else is here
This is the EASIEST MONEY to make out there right now.
Nothing compares.
Well actually........... $NATUF is next but either you get it or you don't
I find the WINNERs.......... whats my name ?
GO $HTZZ
$HTZZ: Time to WIN again......... added 5k here at $19
GO $HTZZ
Basically debt free and lots of room for upside
Got a feeling this will run hard.
Kind of wondering what premarket brings.
HTZGQ changed to HTZZ: HTZGQ Shares cancelled in exchange for new Common at 0.09044939 per share, Warrants at a rate of .6452782 per share and cash of $1.53 per share.
https://otce.finra.org/otce/dailyList?viewType=Deletions
https://otce.finra.org/otce/dailyList?viewType=Additions
Followers
|
119
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
3543
|
Created
|
11/20/06
|
Type
|
Free
|
Moderators |
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |