The car rental company's stock just lost 16% of its value in one day, and the reason is a famous investor walking away.
Hertz shares tumbled 16% on August 13, 2026, after Pershing Square's chief investment officer said the firm had sold its stake. Ryan Israel made the announcement on a call posted to X, explaining that the firm no longer trusted Hertz's leadership after the company announced a funding plan that Israel said "we did not think was necessary."
The move ends a wild stretch for the stock, and it raises a simple question: what happens to a turnaround story when its biggest believer leaves?
To understand where Hertz stands now, you have to look at where it has been.
The 85% run-up came after a brutal crash. The stock had fallen 70% from its late-June levels, bottoming out at a record low of $1.51 on Aug. 4. The company declared bankruptcy in 2020 and re-listed on the stock market in 2021, so investors have been through this kind of whiplash before.
Earlier in 2026, the picture looked brighter. Long lines at US airports boosted rental-car demand, and a short squeeze drove up the stock of rival Avis Budget Group. Short squeezes happen when traders who bet a stock will fall are forced to buy shares to cover their positions, which pushes the price even higher.
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But then came the warning. Hertz had its worst trading day since re-listing after flagging weakness in the used-vehicle market and announcing a simultaneous stock sale and bond offering. That funding plan is the one Pershing's Israel called unnecessary.
Pershing Square had been trimming its stake for a while. As of March 31, the firm owned 4.3% of Hertz, down from 19.8% the previous spring, according to Bloomberg data. The full exit is a signal, and Eric Diton, president and managing director of The Wealth Alliance, said it plainly.
"It certainly hurts the turnaround story to see a savvy investor like Ackman sell his position," Diton said.
Hertz declined to comment on the sale. Pershing disclosed its second-quarter results after the market closed on Wednesday, and the Hertz news came as part of that update.
Israel described the funding plan as "unlike anything we had really seen a company do before." For a firm known for backing management teams it trusts, that is a strong statement.
Hertz carries a heavy load. That makes it sensitive to any hiccup in the used-car market, where prices have been soft.
Diton summed up the situation in one line: "Volatility is here to stay."
For investors, that is the real takeaway. The stock closed at $3.65 before the drop and now sits near $2.35, and the path between those numbers has been anything but smooth. A company that has already gone through one bankruptcy and re-listing is now trying to convince the market it can manage through a rough patch without the backing of one of the most famous investors in the country.
The turnaround story is not dead, but it just lost its most visible supporter. When a savvy investor like Ackman heads for the door, the rest of the market tends to notice - and the share price reflects that in a hurry.
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