Dollar Thrifty Automotive Group Inc. recently announced that its second-quarter results were below expectations and that it no longer expects to meet its full-year earnings target amid challenges with daily revenue and vehicle depreciation costs.
Shares of Dollar Thrifty recently lost more than a fifth of their value after analysts responded negatively to the car rental company's lowered 2008 outlook.
The stock plunged $1.49, or 26.1 percent, to $4.21 in morning trading on July 2, 2008 and touched an all-time low of $4.18.
Dollar Thrifty Investors sold off the stock, pushing shares down $3.75, or 40 percent, to $5.70.
"The balance of the year looks less robust than we had forecasted, given overall economic trends," Chief Executive Gary L. Paxton said.
The manager of the Dollar Rent A Car and Thrifty Car Rental brands had targeted 2008 earnings, excluding items, of $1 to $1.50 a share. It didn't give a new projection, though Paxton said Dollar Thrifty expects to be profitable. It lowered its estimate of corporate earnings before interest, tax, depreciation and amortization to "a minimum" of $50 million from $97 million to $115 million. Analysts expected $90.3 million.
Paxton sais Dollar Thrifty's focus is on improving revenue diversification, fleet utilization, productivity and cost control.