Hertz Slumps as Investors Kept in Dark on Recovery-Plan Cost

When Kathryn Marinello took the reins at Hertz Global Holdings Inc. in January, she inherited a company that was bleeding red ink and had a bloated rental fleet. To try to turn it around, she decided to overhaul its supply of cars even if it meant crushing earnings and sending shares plunging.

She achieved both. Despite a weak market for used vehicles, Marinello started selling off Hertz’s compact cars and family sedans, which are out of favor with U.S. drivers, and take a hit. She also stocked up on new models, a move that played a big part in Hertz’s $1.61 per share adjusted loss and pushed the share price into a freefall.