Stocks breaking to new annual highs
S&P 500 oversold value screener
Relative strength momentum leaders
Upcoming earnings dates & reports
Filter and sort all 500 stocks
Continuous multi-factor scoring & catalyst forensics
Today's biggest gainers and losers
Goodyear is a global tire manufacturer with operations across Americas, Europe, Middle East & Africa, and Asia-Pacific, producing replacement and original equipment tires for passenger vehicles, commercial trucks, aircraft, and off-road equipment. The company operates ~50 manufacturing facilities worldwide and competes with Michelin, Bridgestone, and Continental in a capital-intensive, commodity-sensitive industry. Currently facing significant financial distress with negative margins, elevated leverage (2.24x D/E), and near-zero free cash flow generation.
Goodyear generates revenue through tire sales with pricing influenced by raw material costs (synthetic rubber, natural rubber, carbon black, steel cord), brand premium, and distribution channel mix. Replacement market offers higher margins (15-20% gross) than OE business (8-12% gross) due to brand loyalty and less price sensitivity. The company's profitability depends heavily on manufacturing efficiency, capacity utilization (breakeven typically ~75-80% utilization), and ability to pass through raw material inflation. Current 18.4% gross margin and 3.6% operating margin indicate severe margin compression, likely from volume declines, pricing pressure, and unabsorbed fixed costs. Limited pricing power versus premium competitors (Michelin) and aggressive Asian manufacturers.
Raw material cost trends - natural rubber, synthetic rubber, and crude oil derivatives represent 60-70% of COGS; sharp moves in commodity prices directly impact gross margins with 1-2 quarter lag before pricing adjustments
Replacement tire volume trends in key markets - US replacement tire shipments (largest market), European demand, and China market recovery drive top-line growth
OE production schedules - global light vehicle production volumes from major automakers determine OE tire demand; current automotive production ~85M units annually
Debt refinancing and liquidity concerns - with 2.24x D/E ratio and negative FCF, any covenant concerns, credit rating changes, or refinancing announcements move the stock significantly
Restructuring announcements - plant closures, workforce reductions, or asset sales to improve cost structure and liquidity
Electric vehicle adoption reducing tire replacement frequency - EVs are heavier (increasing tire wear) but have regenerative braking (reducing wear), with net effect potentially reducing replacement cycles by 10-20% as EV penetration reaches 30-40% of fleet
Shift to mobility-as-a-service and declining vehicle ownership in urban markets - ride-sharing and autonomous fleets could consolidate tire purchasing power with fleet operators demanding lower prices
Chinese tire manufacturer expansion - brands like Giti, Triangle, and Linglong gaining share in value segments with 30-40% price discounts to established brands, particularly in emerging markets
Premium brand erosion versus Michelin and Bridgestone - competitors investing more heavily in R&D for high-performance and EV-specific tires, potentially widening technology gap
Retail channel disruption - online tire sales (TireRack, Amazon) and mobile installation services bypassing traditional dealer networks where Goodyear has historically held advantages
Private label and value brand penetration - retailers like Walmart and Costco expanding house-brand tire offerings at 20-30% discounts to branded alternatives
Debt maturity wall and refinancing risk - estimated $1-2B in near-term maturities requiring refinancing in potentially unfavorable credit markets; any inability to refinance could trigger distressed scenarios
Pension and OPEB obligations - legacy defined benefit pension plans and retiree healthcare obligations estimated at $2-3B underfunded, requiring ongoing cash contributions that consume operating cash flow
Working capital strain - 1.06x current ratio indicates minimal liquidity cushion; inventory management critical as raw material costs fluctuate and demand weakens
Covenant compliance risk - negative profitability and FCF may approach debt covenant thresholds, limiting operational flexibility and potentially triggering technical defaults
high - Tire demand correlates strongly with vehicle miles traveled (VMT), which tracks GDP growth and employment levels. Replacement tire purchases are semi-discretionary; consumers defer purchases during recessions, extending tire life by 10-15%. OE tire volumes directly follow automotive production, which is highly cyclical. Commercial truck tire demand links to freight volumes and industrial activity. Current -3.2% revenue decline suggests cyclical headwinds or market share loss.
High sensitivity through multiple channels: (1) Elevated debt load ($5.8B estimated net debt) means rising rates increase interest expense by $50-100M annually per 100bps move, directly pressuring negative margins. (2) Higher rates reduce automotive affordability, suppressing new vehicle sales and OE tire demand. (3) Consumer financing costs for tire purchases increase, potentially deferring replacement cycles. (4) Valuation multiple compression as distressed equity becomes less attractive versus risk-free rates.
Critical exposure - company's survival depends on credit market access for refinancing maturing debt and maintaining revolving credit facilities. High yield credit spreads widening would increase borrowing costs and potentially trigger covenant concerns. Current negative profitability and FCF make the company vulnerable to credit downgrades, which would further increase financing costs and limit strategic flexibility. Estimated $1-2B in debt maturities over next 24 months require favorable credit conditions.
value/distressed - Current 0.1x P/S and 0.8x P/B ratios attract deep value investors betting on operational turnaround or restructuring catalysts. Negative profitability and -42.3% ROE eliminate dividend and quality-focused investors. High volatility and bankruptcy risk appeal to distressed debt specialists and event-driven hedge funds positioning for potential debt-for-equity swaps or asset sales. Not suitable for growth, income, or conservative investors given financial distress.
high - Estimated beta 1.8-2.2x given cyclical industry exposure, financial leverage, and distressed valuation. Stock exhibits 40-60% annualized volatility with sharp moves on earnings misses, commodity price swings, or credit market developments. Recent -5.3% returns across multiple timeframes suggest sustained downward pressure. Liquidity concerns and low market cap ($2.6B) amplify volatility during market stress.
