GoodYear Tire (GT) AI Stock Analysis

• Market Cap: $2.67B
• Dividend Yield: N/A
• Average Volume (3M): 6.34M
• Price to Earnings (P/E): 38.9
• Beta (1Y): 1.80
• Revenue Growth: -5.92%
• EPS Growth: N/A
• Country: US
• Employees: 68,000
• Sector: Consumer Cyclical
• Sector Strength: 49
• Industry: Vehicles
• EPS (TTM): 0.24
• Shares Outstanding: 285,114,500
• 10 Day Avg. Volume: 6,198,473
• 30 Day Avg. Volume: 6,342,503
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.15
• Price to Cash Flow (P/CF): 0.50
• P/FCF Ratio: 0.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $11.30
• Price Target Upside: 20.47% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

GoodYear Tire's overall score reflects its current financial challenges and cash flow constraints, despite improvements in operational efficiency. The technical indicators show moderate upward momentum, but the valuation raises concerns of overvaluation. The earnings call provided some positive updates on strategic initiatives, but also highlighted ongoing challenges with unit volumes and costs.

Positive Factors

Restructuring Plan

The company's Goodyear Forward plan effectively offset headwinds, leading to flat YoY absolute SOI.

Negative Factors

Free Cash Flow

Goodyear reports 3Q24 FCF of $(340)m vs VA cons of $195m, with the FCF miss likely to keep shares muted.

Market Competition

Declines in replacement volume and unfavorable price/mix reflect member declines in the US and low-cost imported products growing significantly.

GoodYear Tire Business Overview & Revenue Model

Company Description

The Goodyear Tire & Rubber Company (GT) is a global leader in the tire manufacturing industry, headquartered in Akron, Ohio. Founded in 1898, the company operates in various sectors including automotive, aviation, and industrial, providing innovative tire products and solutions. Goodyear's core offerings include a wide range of tires for passenger vehicles, commercial trucks, racing cars, airplanes, and heavy machinery. The company is renowned for its commitment to quality, performance, and safety, serving both consumer and commercial markets worldwide.

How the Company Makes Money

Goodyear Tire & Rubber Company generates revenue primarily through the design, manufacture, distribution, and sale of tires and related products. Its key revenue streams include sales of replacement tires to consumers and original equipment tires to automotive manufacturers. The company capitalizes on its vast network of retail outlets, distribution centers, and partnerships with automotive service providers to maximize market reach. Additionally, Goodyear benefits from strategic alliances and joint ventures, which enhance its global distribution capabilities and technological advancements. The company's revenue is also influenced by factors such as raw material costs, global economic conditions, and regulatory requirements in the automotive industry.

GoodYear Tire Financial Statement Overview

Summary

GoodYear Tire is facing financial challenges with revenue and profitability volatility, and cash flow constraints. While operational efficiency has improved, the company needs to address profitability and cash management issues.

Income Statement

GoodYear Tire has faced challenges in maintaining consistent revenue growth, with a significant decline from 2020 to 2023. While revenue decreased by 5.9% from 2023 to 2024, the gross profit margin improved dramatically in 2024 due to cost management efforts. However, the net profit margin remained low, indicating persistent profitability challenges. The EBIT margin improved in 2024, suggesting better operational efficiency, but the absence of positive EBITDA in 2024 is concerning.

Balance Sheet

The company has a moderate debt-to-equity ratio, reflecting a balanced capital structure. However, the equity ratio has shown some volatility, indicating fluctuating financial stability. Return on equity has been inconsistent, with a positive turn in 2024, but overall performance has been unstable.

Cash Flow

Cash flow management is a concern, with negative free cash flow in recent years. The operating cash flow to net income ratio in 2024 was positive, showing some operational cash generation capacity. Still, the free cash flow to net income ratio highlights cash flow constraints and the need for better capital expenditure management.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
18.88B	20.07B	20.80B	17.48B	12.32B
	Gross Profit
18.88B	3.51B	3.85B	3.79B	1.98B
	EBIT
16.10B	73.00M	883.00M	993.00M	-327.00M
	EBITDA
1.73B	856.00M	1.85B	1.82B	69.00M
	Net Income Common Stockholders
60.00M	-689.00M	202.00M	764.00M	-1.25B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
810.00M	902.00M	1.23B	1.09B	1.54B
	Total Assets
20.96B	21.58B	22.43B	21.40B	16.51B
	Total Debt
8.79B	8.65B	8.91B	8.42B	6.87B
	Net Debt
7.98B	7.75B	7.68B	7.33B	5.33B
	Total Liabilities
16.06B	16.75B	16.96B	16.22B	13.25B
	Stockholders Equity
4.91B	4.67B	5.30B	5.00B	3.08B
Cash Flow		Free Cash Flow
-490.00M	-18.00M	-540.00M	81.00M	468.00M
	Operating Cash Flow
698.00M	1.03B	521.00M	1.06B	1.11B
	Investing Cash Flow
-1.00B	-1.03B	-914.00M	-2.79B	-667.00M
	Financing Cash Flow
225.00M	-333.00M	575.00M	1.31B	203.00M

GoodYear Tire Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 9.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GT, the sentiment is Positive. The current price of 9.38 is above the 20-day moving average (MA) of 9.36, above the 50-day MA of 9.11, and below the 200-day MA of 9.58, indicating a neutral trend. The MACD of 0.05 indicates Positive momentum. The RSI at 51.58 is Neutral, neither overbought nor oversold. The STOCH value of 81.56 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GT.

GoodYear Tire Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BRDCY	76 Outperform	$28.67B	14.84	7.90%	2.31%	-6.42%	-23.26%
LEA	70 Outperform	$5.16B	11.08	10.81%	3.10%	-0.70%	-7.27%
DAN	64 Neutral	$2.02B	―	-3.92%	2.96%	-2.57%	-248.28%
BWA	62 Neutral	$6.39B	19.85	6.46%	1.47%	-11.10%	-46.32%
GTX	61 Neutral	$1.86B	7.36	-41.90%	0.65%	-10.58%	―
Sector *	60 Neutral	$12.39B	10.47	1.07%	3.58%	1.64%	-18.33%
GT	55 Neutral	$2.67B	38.87	1.49%	―	-5.92%	―

GoodYear Tire Corporate Events

Goodyear Tire Increases Equity Grant for Directors

On February 25, 2025, Goodyear’s Board of Directors approved amendments to the Outside Directors’ Equity Participation Plan, increasing the annual equity grant from $160,000 to $180,000 and introducing an elective deferral provision for stock units. These changes, effective from April 2025, allow directors to defer receipt of stock units, which will be converted to common stock upon leaving the Board, potentially impacting director compensation and company governance.

Goodyear Tire Sells Dunlop Rights to Sumitomo

Goodyear Tire & Rubber Company has entered into an agreement to sell its rights to the Dunlop brand for consumer, commercial, and specialty tires in Europe, North America, and Oceania to Sumitomo Rubber Industries for $526 million, with an additional $105 million Transition Support Fee. The deal, expected to close by mid-2025, is part of Goodyear’s strategy to optimize its brand portfolio and reduce leverage, aligning with their Goodyear Forward transformation plan. Goodyear will continue producing Dunlop tires in Europe temporarily and will supply tires to Sumitomo under a five-year Transition Offtake Agreement, which will help maintain service levels for existing customers.