Shares of Goodyear Tire & Rubber (GT) fell 5.69% to US$26.44 in morning trading Tuesday.
It came amidst the company’s announcement that it now expects full-year 2014 segment operating income (SOI) growth to be slightly below its original 10% to 15% range.
The company also said it anticipates flat global volume and expects fourth-quarter impact of the aforementioned developments to be 15 cents to 20 cents per share below expectations at the time of the third-quarter call.
Other important highlights include:
- Compared to last year, the stock is now trading at a higher level, regardless of the company’s weak earnings results. Turning the attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- GOODYEAR TIRE & RUBBER CO’s earnings per share declined by 6.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, GOODYEAR TIRE & RUBBER CO increased its bottom line by earning $2.23 versus $0.69 in the prior year. This year, the market expects an improvement in earnings ($3.00 versus $2.23).
- Net operating cash flow has increased to $195.00 million or 18.90% when compared to the same quarter last year. Despite an increase in cash flow, GOODYEAR TIRE & RUBBER CO’s average is still marginally south of the industry average growth rate of 22.45%.