Zipcar Falls Most Since IPO After Forecasting Quarterly Loss: Boston Mover
Zipcar Inc. (ZIP) fell the most since its initial public offering 10 months ago after forecasting first- quarter profit that was lower than analysts’ estimates as it boosts marketing and other expenses to expand in Europe.
Zipcar, which rents cars by the hour or day, dropped as much as 16 percent, the biggest intraday slide as a public company. Shares fell 14 percent to $13.90 at 12:50 p.m. New York time. The shares had risen 20 percent this year before today.
The company said it will report a net loss of as much as $5 million this quarter, typically its slowest. Based on the average 42.2 million shares outstanding in the fourth quarter, that equates to a loss of as much as 12 cents a share. That’s a larger loss than the average estimate of a 7-cent deficit of three analysts surveyed by Bloomberg.
The company said during a conference call today that it expects costs of about $2 million this year, related to its new European headquarters and new executives, including Frerk-Malte Feller, hired last month to run Zipcar Europe. Zipcar, which is based in Cambridge, Massachusetts, said sales this quarter would be as much as $60 million, trailing the average $60.6 million estimate of three analysts in a Bloomberg survey.
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