What Happened?
A number of stocks fell in the afternoon session after President Trump declared the Iran ceasefire "over" and vowed renewed strikes, reversing the fuel relief the sector had enjoyed and sending oil back above $75.
Transportation is the most direct cyclical proxy for fuel costs and global trade volumes. Airlines, truckers, railroads, parcel carriers, and ocean shippers all run on diesel and jet fuel, typically their second-largest cost line behind labor, so the roughly 7% crude jump flows almost dollar-for-dollar out of operating margin within the same quarter.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Ground Transportation company Hertz (NASDAQ: HTZ) fell 6.9%. Is now the time to buy Hertz? Access our full analysis report here, it’s free.
- Ground Transportation company Saia (NASDAQ: SAIA) fell 2.8%. Is now the time to buy Saia? Access our full analysis report here, it’s free.
Zooming In On Hertz (HTZ)
Hertz’s shares are extremely volatile and have had 54 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 13 days ago when the stock dropped 14.8% on the news that the stock continued to retreat as the company cut its second-quarter profit forecast and announced plans to raise capital through stock and note offerings.
The move extends a sharp drop from the previous session after Hertz lowered its second-quarter Adjusted Corporate EBITDA guidance to a range of $50 million to $80 million, well short of analyst estimates. The company cited “unexpected softness in the used car market” for the revision, which is increasing depreciation costs and causing losses on vehicle disposals.
Alongside the weaker outlook, Hertz revealed plans to offer $100 million in stock and $300 million in notes. Such capital-raising efforts are often seen by investors as a sign that a company needs cash, adding to negative sentiment. Following the news, analysts at firms including J.P. Morgan reiterated their "Sell" ratings on the stock, pointing to the weaker operating performance.
Hertz is down 62.7% since the beginning of the year, and at $1.95 per share, it is trading 75.6% below its 52-week high of $7.97 from July 2025. Investors who bought $1,000 worth of Hertz’s shares 5 years ago would now be looking at only $101.14.
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