Hertz Global Holdings Inc (HTZ)

Fixed asset turnover

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Revenue US$ in thousands 9,371,000 8,685,000 7,336,000 5,258,000 9,779,000
Property, plant and equipment US$ in thousands 671,000 637,000 608,000 666,000 757,000
Fixed asset turnover 13.97 13.63 12.07 7.89 12.92

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $9,371,000K ÷ $671,000K
= 13.97

The fixed asset turnover ratio for Hertz Global Holdings Inc. has been decreasing over the past three years, indicating a decline in the efficiency of utilizing fixed assets to generate revenue. In 2021, the ratio was highest at 0.75, but it dropped to 0.66 in 2022 and further decreased to 0.61 in 2023.

A fixed asset turnover ratio below 1 suggests that the company is generating less revenue per dollar invested in fixed assets. This trend may indicate underutilization or inefficiency in managing fixed assets, leading to a negative impact on profitability.

Management should closely monitor and evaluate the company's asset utilization strategies to improve efficiency and profitability in the long term. Additionally, exploring ways to optimize the use of fixed assets or considering divestiture of underperforming assets could help improve the fixed asset turnover ratio in the future.


Peer comparison

Dec 31, 2023

Company name
Symbol
Fixed asset turnover
Hertz Global Holdings Inc
HTZ
13.97
Avis Budget Group Inc
CAR
16.70
Ryder System Inc
R
10.08