Avis Budget Group (NYSE:CAR), Hertz Global (NYSE:HTZ) Top Barclays' (NYSE:BCS) Car Rental Picks

Avis Budget Group (NYSE:CAR) and Hertz Global (NYSE:HTZ) are the top picks of Barclays (NYSE:BCS) in the car rental industry, which improved its metrics in November, a major travel month.

Barclays said, "The US car rental industry saw solid further improvement across all its metrics in November 2010, including travel demand, car rental pricing, and fleet costs. In this monthly report, we analyze those key trends for the sector. Enplanements were up by 5.5% y-o-y in November; 2) Rental pricing comparisons continued to improve in November, down just 1.3% yoy; 3) The Manheim Index of used car prices broke a new record in November 2010.

"We reiterate our OW rating and $18 price target on Avis Budget Group, reflecting our view that the stock offers large additional upside potential in the near-term, as CAR's profitability benefits from the company's strong operating leverage in the context of a continued improvement in travel demand.

"For longer-term investors, we recently upgraded Hertz Global to OW and raised our price target to $20. HTZ should also benefit from the rebound in travel, but offers a stronger growth potential than its car rental peers, benefitting from its exposure to the equipment rental market which is in very early stages of recovery, and from management's initiatives to grow its off-airport market share and margins."

Avis Budget Group closed at $14.70, up $0.28, or 1.94 percent on Monday. Hertz closed at $14.31, up $0.05, or 0.35 percent.