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The company's retail unit is teaming up with Amazon.
This will initially be a pilot program and expand throughout the country if successful.
In the popular imagination, Hertz Global Holdings (NASDAQ: HTZ) isn't an ideal, or even appropriate, choice of business partner for Amazon (NASDAQ: AMZN).
After all, the former company is an auto rental incumbent of longstanding, and the latter is a monster retailer. Yet the two businesses announced a collaboration in mid-August, and investors liked what they heard about the deal. Here's a look at why, and whether it makes Hertz stock a buy now.
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Hertz is a retailer through its Hertz Car Sales unit, although of course it's almost entirely identified as a rental agency.
Image source: Getty Images.
So it might have been surprising to read Hertz's announcement that it is going to be a seller on Amazon Autos. Customers purchasing a Hertz used vehicle will be able to pick it up at one of the 45 Hertz Car Sales outlets in this country. At first, this service will be offered in Los Angeles, Seattle, Houston and Dallas as a pilot program. If successful, it'll expand nationwide.
Judging by the market's reaction to the news, investors are thinking the deal will surely be beneficial to Hertz.
It's highly uncertain by how much, however. The company provided almost no details of the Amazon Autos deal, and that includes financial particulars like estimated revenue. That isn't all that surprising because the rental king is awfully mum about the performance of Hertz Car Sales. In fact, the division gets merely two mentions in the company's 22-page second quarter of 2025 earnings report.
In that document, Hertz only says that Hertz Car Sales' volume was the highest in all of the second quarters stretching back five years. No further information is provided.
Hertz probably doesn't break out the unit's fundamentals because they (likely) aren't impressive. Given that, I don't think the Amazon deal will be any kind of game changer, and I wouldn't trade the stock purely on the news. If it gets Hertz to be more transparent about its retail efforts, however, at least that will be a small victory for shareholders.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.
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