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Non-Tech : Auto Rental Companies - AVI, BD, HRZ, DTG, AN
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To: Paul Senior who wrote (3)11/11/1998 4:38:00 PM
From: Grommit  Read Replies (1) of 218
 
I believe the issue with BD was that they made their numbers by lowering insurance reserves. That gave them another .23 per share. And the tax rate was unusually low, said one analyst. I think the analysts were pissed that they were blindsided with the "bad qtr" and I expected them to downgrade and lower estimates with a passion. And they did. (I rode BD up a few points before earnings and when I saw that news I bailed and bought AVI instead.)

I like your logic, but BDs margins were lower than expected. I think I recall reading that they were aggressively pricing. If so, they are justified in getting their future earnings estimated lowered. I think the stock price may have been punished enough, I will look at it again.
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