So I made 10k USD last week shorting $CAR with short credit spread (sell calls). As a regard, I went again, with much bigger trades.
\# Why?
Fundamentals: they are shit, look at others DD For more details.
Market dynamics: Avis advanced their earning calls to tomorrow morning.
Speculatively, this would allow them to sell new offerings (share dilution) just after their earnings. This would be on top of the 5M shares ATM that they only need to report once quarterly (IMHO they had fun selling them between 200 and 500 USD). This mechanically reduce the fair price by 12% and the amount of new offerings proposed by Avis (speculatively).
Mechanically, after the earnings, the quiet periods ends, and all insiders (managers, employees), especially SRS management who owns 49% of the company are allowed to sell, and this level of price is probably really high, given the share dilution.
So profit taking will be happen and more shares will be available to short.
Even with stellar unlikely earning results, I can’t see the current share price being sustained.
Positions: 10 long puts at 150, 100 calendar spread put at 100 for this and next week.
Not a financial advice. Do your own research.