GT - Embedded Expectations Analysis - 2019 02 27
The Goodyear Tire & Rubber Company (GT:USA) currently trades near recent lows relative to UAFRS-based (Uniform) Assets, with a 0.7x Uniform P/B, implying muted expectations for the firm. However, management is excited about the potential of Roll, and is confident about Tirehub's ability to promote premium brands, their price mix, and the durability of tires for electric and commercial vehiclesSpecifically, management generated an excitement marker when talking about Roll's ability to reduce the complexity of the tire buying process. Additionally, they are confident in Tirehub's ability to promote their premium brands, their Chinese customer base, and their focus on eliminating balance sheet deterioration. Moreover, they are confident their price increases have improved their price mix compared to raw material costs, and align them with industry peers. Finally, they are confident in their ability to manage durability of tires for electric and commercial vehicles
Goodyear Tire & Rubber develops, manufactures, distributes and sells tires and related products and services worldwide. The company manufactures and markets various lines of rubber tires for: automobiles, trucks, buses, aircraft, motorcycles, earthmoving and mining equipment, farm implements, industrial equipment, and various other applications. The company manufactures and sells tires under the Goodyear, Dunlop, Kelly, Debica, Sava and Fulda brands and various other Goodyear owned house brands, and the private-label brands of certain customers. The company operates its business through three operating segments representing its regional tire businesses: Americas; Europe, Middle East and Africa; and Asia Pacific.
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