A Car Rental Stock Is Up 700% In One Month. Is It A Meme Stock?

BreakingInnovationA Car Rental Stock Is Up 700% In One Month. Is It A Meme Stock?ByAlicia Park,Fellow. I cover tech and innovation.Follow AuthorApr 22, 2026, 02:21pm EDTApr 22, 2026, 02:30pm EDT--:-- / --:--This voice experience is generated by AI. Learn more.This voice experience is generated by AI. Learn more.ToplineAvis Budget Group stock rose as much as 700% in the last four weeks, surging 18% when markets opened on Wednesday to an all-time high of $847 before tanking more than 40%. (Photo by Smith Collection/Gado/Getty Images)Getty ImagesKey FactsThe car rental company’s stock rallied to record highs Wednesday, despite the business reporting billion-dollar net losses in the last two years as demand for used cars declined and expensive business decisions—like expanding its fleet of electric vehicles—ate away at profits. The stock surge could in part be due to increasing travel demand since January as noted by Deutsche Bank, with some travelers—especially spring breakers—opting to drive to avoid flight delays and complications due to airport staffing shortages during a partial government shutdown in February and March.But the extreme rally this month is mainly due to investors who had previously bet that the company would not do well by using a method called shorting—when an investor borrows shares of the stock from someone and immediately sells it to someone else, with the intent of buying those shares back when prices go down so they can pocket the difference when paying back the original owner of the shares.A series of SEC filings in March and April showed two hedge funds SRS Investment Management and Pentwater Capital owned 71% of shares, with Pentwater in particular aggressively increasing its stake to 22% from around 8% last year.Pentwater removing so many shares from the public market triggered short sellers to aggressively buy back their borrowed shares to prevent having to pay back the original owner of the shares at a higher price, with the artificial d...