The Zipcar Conundrum


Over the next couple of weeks analysts John Reeves and David Meier will be reviewing their real-money, 10-Bagger Portfolio. In this video, they take a closer look at Zipcar.

Zipcar has been a conundrum so far. The business continues to make progress, although not as fast as we would like, but the stock price has gone in reverse. The company continues to increase its membership base and add cars to its fleet. Its car-sharing fleet is actually much larger than Hertz's and Avis'. Meanwhile, the company is investing in international expansion, but has felt the pinch of the recession in the U.K. As a result, Zipcar reduced its revenue guidance -- something the market did not want to hear. Zipcar continues to make strides toward profitability, and is generating operating cash flow. However, it's not happening fast enough for many investors. John and David think the stock has been oversold, and offers a buying opportunity for long-term investors here.

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David Meier owns shares of Zipcar. John Reeves has no positions in the stocks mentioned above. The Motley Fool owns shares of Ford, Hertz Global Holdings, and Zipcar. Motley Fool newsletter services recommend Ford and Zipcar. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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