US Stock Market Move | The "demon stock" Avis Budget Group, Inc. (CAR.US) plunged over 42%, falling by 63% in two days.

On Thursday, Avis Budget Group, Inc. (CAR.US) plummeted by over 42%, suffering a 63% drop in just two days, after experiencing a meteoric rise of 390% earlier in the month, in what can be described as an epic short squeeze. The surge in Avis Budget Group, Inc. began at the end of March when hedge fund Pentwater Capital suddenly announced a position in the company, quickly increasing their stake to 22%. Combined with long-time major shareholder SRS Investment Management holding nearly 50% of the shares, these two entities locked up around 71% of the available float. This surprise increase in holdings caused a severe shortage of tradable shares on the market. However, during the frenzy of soaring stock prices, the fundamentals of Avis Budget Group, Inc. did not improve concurrently, and major Wall Street banks remained skeptical. In the fourth quarter of 2025, the company reported revenue of $2.664 billion, lower than market expectations, and a huge loss due to impairment of electric vehicle fleet assets. On April 21, Barclays downgraded Avis Budget Group, Inc. to "sell," believing that the surge was fundamentally a result of "misalignment of supply and demand," and that the current stock price still lacked reasonable support. The average analyst target price is only $121.5, indicating significant downside potential from the current levels.