10 IPOs that flopped
The venerable rental car company, once owned by Ford Motor, was bought by a private equity group in 2005. The new owners proceeded to pile large amounts of debt onto the company. Just a year or so later, management took the rent-a-car company public at $15 a share, pocketing a cool $1.4 billion in the process.
But the short turnaround between going private and going public worried many investors, who thought the new owners treated Hertz like a rental. Said one industry observer: "It's the IPO everybody is loving to hate." The stock eventually rose to more than $26 by June 2007. By Feb. 2009, however, shares of Hertz had fallen to around $3. Seven years since the IPO, Hertz stock is trading at nearly $13 — still below its initial offering price.