The Goodyear Tire & Rubber CompanyGT is one of the world's largest tire manufacturing companies, selling under Goodyear, Kelly, Dunlop, Fulda, Debica, Sava and various other brands. The company regularly launches innovative products and services to boost sales. Although Goodyear generates worldwide sales, North America is its leading market. It is also expanding in emerging markets to boost profits.
Goodyear is benefitting from lower raw material costs, strong economic trends in North America and continued cost savings, partially offset by a challenging international environment and unfavorable foreign currency translation due to the continuing strength of the U.S. dollar. Goodyear's revenue has been declining over the years. The company has also been facing challenges in terms of a volatile political and economic environment and high currency fluctuations.
Estimate Trend & Surprise History
Investors should note that the third-quarter earnings estimate for Goodyear has decreased by a penny to $1.04 over the past 30 days.
The company delivered positive earnings surprises in each of the last four quarter with an average beat of 10.28%. Investors have been eagerly awaiting Goodyear's latest earnings report to see whether it delivers an earnings beat in the third quarter as well.
GOODYEAR TIRE Price and EPS Surprise
Goodyear currently has a Zacks Rank #1 (Strong Buy), but that could change following its earnings report which was just released. We have highlighted some of the key stats from the company's earnings announcement below:
Goodyear reported adjusted earnings of $1.17 per share in the third quarter of 2016, surpassing the Zacks Consensus Estimate of $1.16. Adjusted earnings were higher than 99 cents generated in the year-ago quarter.
Goodyear logged revenues of $3.85 billion, missing the Zacks Consensus Estimate of $3.97 billion. However, revenues were lower than $4.18 billion posted a year ago, mainly due to the deconsolidation of the subsidiary in Venezuela.
Key Stats/Developments to Note
Goodyear revised its previous guidance. The company now expects total segment operating income for 2016 to be between $2 billion and $2.025 billion. The company however confirmed its 2020 financial targets and capital allocation plan, which were announced on Sep 15, 2016.
During the reported quarter, Goodyear repurchased 1.7 million shares for $50 million under the previously announced $1.1 billion share repurchase program.
Goodyear's share price has decreased 6.69% so far in pre-market trading following the release. It would be interesting to see how the market reacts to the results during the trading session today.
Check back later for our full write up on Goodyear's earnings report!
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