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Hertz feels weird to me as an example for two reasons: 1. The company wasn’t really leaning into the thing where they became a meme stock when they filed for b
by dan-robertson 5y ago
Hertz feels weird to me as an example for two reasons:
1. The company wasn’t really leaning into the thing where they became a meme stock when they filed for bankruptcy for some reason. They did start an at-the-market offering but that was stopped pretty quickly by the courts.
2. It did actually go up for non-meme reasons so the crazy people buying stock of a bankrupt company, or rather, the people who believed what they read on Reddit and bought the stock and didn’t sell it, we’re vindicated as the company did somewhat recover.
- anyfactor 5y agoI was there when Hertz became memefied. Memefication always starts with atleast some good research. There was three schools of thoughts with the Hertz saga- 1. Bankrupt companies are required to buyback their shares from the market. If they force the share price to go up the company is required to buyback the stock from the market regardless of the price. 2. People expected that Hertz would get a lifeline from a hedge fund. 3. Hertz car inventory still had value. If you look at used car prices you can see this sentiment was true. They thought Hertz had plenty of good assets that was just affected by the pandemic but after the pandemic prices would go up. So essentially, it was backed by some logic but when it comes to finance logic validity of that is subjective.