Overview
Pentwater Capital Management LP, identified as a ten-percent owner of Avis Budget Group, Inc. (NASDAQ: CAR), reported the purchase of 425,000 shares of common stock on February 20, 2026. The weighted average price per share for the transaction was $94.259, representing a total outlay of $40,060,075. The executed prices for these shares ranged between $92.9355 and $95.1190.
Market context
At the time of reporting, Avis Budget's shares were trading at $93.99, having declined 23.77% over the previous week. InvestingPro analysis cited in the disclosure indicates the stock is undervalued at current levels, though the company carries a WEAK financial health rating and a market capitalization of $3.3 billion.
Options activity disclosed in Form 4
Alongside the equity purchase, Pentwater's Form 4 filing with the Securities and Exchange Commission details a series of options transactions. On February 23, Pentwater disposed of 347 put options with an exercise price of $85 for $5.8793 per share, and on February 24 it disposed of 650 put options with an exercise price of $80 for $9.7932 per share.
In parallel, the firm acquired call options in the same time window. On February 23, Pentwater acquired 347 call options with an exercise price of $85 for $8.8793 per share. On February 24, it acquired 650 call options with an exercise price of $80 for $20.2858 per share.
After completing the share purchases and option trades detailed in the filing, Pentwater Capital Management directly owns 4,072,300 shares of Avis Budget Group common stock.
Financial results reported by Avis Budget
Separately noted in the disclosure, Avis Budget Group released its Q4 2025 financial results that showed a pronounced shortfall versus expectations. The company reported earnings per share of -21.25 USD, compared with an anticipated -0.2349 USD. That variance is quantified as a surprise of -8,946.4%. Revenue for Q4 2025 was reported at 2.7 billion USD, below the forecasted 2.75 billion USD, representing a 1.82% miss.
Those results underscore the challenges the company faced in the quarter. The filing indicates there were no mentions of analyst upgrades or downgrades in the current reports.
Implications and available analysis
The disclosure references InvestingPro as a provider of additional analysis and 15 ProTips for CAR investors seeking deeper insight into the rental car company’s outlook. The firm’s WEAK financial health rating and recent operating results are flagged as considerations for stakeholders evaluating the company’s strategic direction.
Conclusion
Pentwater’s equity purchase and coordinated options trades add to its position in Avis Budget at a time when the company is reporting significant quarterly shortfalls and that same stock is trading substantially lower over the prior week. The combined appearance of a large block purchase with option activity is documented in the SEC Form 4, and the firm’s post-transaction holding totals 4,072,300 shares.
Key points
- Pentwater Capital bought 425,000 Avis Budget shares on February 20, 2026, at a weighted average price of $94.259, totaling $40,060,075.
- The firm engaged in options trading tied to CAR - disposing of puts and acquiring calls on February 23-24, 2026.
- Avis Budget reported a steep Q4 2025 earnings miss with EPS of -21.25 USD and revenue of 2.7 billion USD versus a 2.75 billion USD estimate.
Risks and uncertainties
- Avis Budget’s reported Q4 2025 EPS and revenue misses point to operational and financial headwinds that affect investor valuation and market confidence - impacting the auto rental and broader travel services sectors.
- The company carries a WEAK financial health rating according to InvestingPro, which may complicate future capital and strategic decisions in capital markets and lending sectors.
- Recent share price volatility, including a 23.77% decline over the prior week, introduces market risk for equity holders and potential liquidity concerns for stakeholders in travel-related equities.