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What's in Store for Goodyear (GT) This Earnings Season?
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The Goodyear Tire & Rubber Company (GT - Free Report) is scheduled to report second-quarter 2018 earnings on Jul 27, before the market opens. In the last reported quarter, this tire manufacturer witnessed a positive surprise of 13.6%. Of the trailing four quarters, the company surpassed estimates in three and missed in one, with an average beat of 11.8%.
Over the past three months, shares of Goodyear have underperformed the industry it belongs to. The stock has lost 19.8% compared with the industry’s decline of 17.6%.
Let’s see, how things are shaping up for this announcement.
The Goodyear Tire & Rubber Company Price and EPS Surprise
In April, Goodyear announced its decision to create a tire-distribution network in the United States through a 50-50 joint venture with Bridgestone Americas, Inc. to be known as TireHub LLC. The new JV will offer a complete range of light-truck and passenger-vehicle tires. This will aid Goodyear to develop its tire business by operating more closely with the customers. An improved distribution network, along with its ability to access more customers, will aid growth.
The company is also developing and launching products, enhanced with new technologies. Earlier, in March, it introduced EfficientGrip Performance tire prototype, specifically for the electric vehicle segment. The specialized tires will be available in Europe by 2019. Based on innovative product launches like this, the company anticipates achieving segmental operating income target of $2-$2.4 billion in 2020.
Moreover, Goodyear pays regular quarterly dividends and engages in frequent share repurchases, with an aim to boost shareholder value. In April 2018, it declared a dividend of 14 cents, which was paid on Jun 1, 2018. Moreover, in first-quarter 2018, Goodyear repurchased around 875,000 shares for $25 million. During 2017-2020, it plans to deploy $3.5-$4 billion.
However, a competitive environment, increased raw-material costs and a drop in worldwide volume sales are few concerns for Goodyear.
Over the past month, the company’s stock has seen the Zacks Consensus Estimate for second-quarter and annual earnings being revised 5.1% and 3.7% downward, respectively.
For the soon-to-be-released quarterly results, the Zacks Consensus Estimate for net sales for Americas, which is the company’s largest geographical segment (constituting almost 53.4% of total sales in 2017), is pegged at $2.01 billion in comparison with the first quarter’s actual sales of $1.93 billion.
For the second-largest geographical segment — Europe, Middle East and Africa (EMEA) (32.1%), the Zacks Consensus Estimate for net sales stands at $1.2 billion. The first quarter’s net sales were $1.33 billion for the EMEA segment.
Further, the consensus mark for the Asia-Pacific’s (14.5%) net sales in the second quarter stands at $574 million, a decline from $571 million recorded in the first quarter.
Earnings Whispers
Our proven model does not conclusively show that Goodyear is likely to beat on earnings this quarter. This is because, a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.
Earnings ESP: Goodyear has an Earnings ESP of -7.92% as the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 51 cents and 56 cents, respectively. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Goodyear currently carries a Zacks Rank #3. Further, this, combined with its Earnings ESP, makes the surprise prediction difficult. Note that we caution against Rank #4 and 5 (Sell-rated) stocks going into the earnings announcement, especially, when the company is witnessing negative estimate revisions.
Stocks to Consider
Here are a few other stocks worth considering from the same space, with the right combination of elements to outpace earnings estimates this time around:
American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) has an Earnings ESP of +0.89% and a Zacks Rank #3. Its second-quarter 2018 results are scheduled to release on Aug 3.
Cummins Inc. (CMI - Free Report) has an Earnings ESP of +1.28% and a Zacks Rank #3. The company’s second-quarter 2018 financial results are scheduled to be released on Jul 31.
Oshkosh Corporation (OSK - Free Report) has an Earnings ESP of +2.85% and has a Zacks Rank of 2. The company is scheduled to report third-quarter fiscal 2018 results on Jul 31.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in Store for Goodyear (GT) This Earnings Season?
The Goodyear Tire & Rubber Company (GT - Free Report) is scheduled to report second-quarter 2018 earnings on Jul 27, before the market opens. In the last reported quarter, this tire manufacturer witnessed a positive surprise of 13.6%. Of the trailing four quarters, the company surpassed estimates in three and missed in one, with an average beat of 11.8%.
Over the past three months, shares of Goodyear have underperformed the industry it belongs to. The stock has lost 19.8% compared with the industry’s decline of 17.6%.
Let’s see, how things are shaping up for this announcement.
The Goodyear Tire & Rubber Company Price and EPS Surprise
The Goodyear Tire & Rubber Company Price and EPS Surprise | The Goodyear Tire & Rubber Company Quote
Factors to Consider
In April, Goodyear announced its decision to create a tire-distribution network in the United States through a 50-50 joint venture with Bridgestone Americas, Inc. to be known as TireHub LLC. The new JV will offer a complete range of light-truck and passenger-vehicle tires. This will aid Goodyear to develop its tire business by operating more closely with the customers. An improved distribution network, along with its ability to access more customers, will aid growth.
The company is also developing and launching products, enhanced with new technologies. Earlier, in March, it introduced EfficientGrip Performance tire prototype, specifically for the electric vehicle segment. The specialized tires will be available in Europe by 2019. Based on innovative product launches like this, the company anticipates achieving segmental operating income target of $2-$2.4 billion in 2020.
Moreover, Goodyear pays regular quarterly dividends and engages in frequent share repurchases, with an aim to boost shareholder value. In April 2018, it declared a dividend of 14 cents, which was paid on Jun 1, 2018. Moreover, in first-quarter 2018, Goodyear repurchased around 875,000 shares for $25 million. During 2017-2020, it plans to deploy $3.5-$4 billion.
However, a competitive environment, increased raw-material costs and a drop in worldwide volume sales are few concerns for Goodyear.
Over the past month, the company’s stock has seen the Zacks Consensus Estimate for second-quarter and annual earnings being revised 5.1% and 3.7% downward, respectively.
For the soon-to-be-released quarterly results, the Zacks Consensus Estimate for net sales for Americas, which is the company’s largest geographical segment (constituting almost 53.4% of total sales in 2017), is pegged at $2.01 billion in comparison with the first quarter’s actual sales of $1.93 billion.
For the second-largest geographical segment — Europe, Middle East and Africa (EMEA) (32.1%), the Zacks Consensus Estimate for net sales stands at $1.2 billion. The first quarter’s net sales were $1.33 billion for the EMEA segment.
Further, the consensus mark for the Asia-Pacific’s (14.5%) net sales in the second quarter stands at $574 million, a decline from $571 million recorded in the first quarter.
Earnings Whispers
Our proven model does not conclusively show that Goodyear is likely to beat on earnings this quarter. This is because, a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.
Earnings ESP: Goodyear has an Earnings ESP of -7.92% as the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 51 cents and 56 cents, respectively. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Goodyear currently carries a Zacks Rank #3. Further, this, combined with its Earnings ESP, makes the surprise prediction difficult. Note that we caution against Rank #4 and 5 (Sell-rated) stocks going into the earnings announcement, especially, when the company is witnessing negative estimate revisions.
Stocks to Consider
Here are a few other stocks worth considering from the same space, with the right combination of elements to outpace earnings estimates this time around:
American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) has an Earnings ESP of +0.89% and a Zacks Rank #3. Its second-quarter 2018 results are scheduled to release on Aug 3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Cummins Inc. (CMI - Free Report) has an Earnings ESP of +1.28% and a Zacks Rank #3. The company’s second-quarter 2018 financial results are scheduled to be released on Jul 31.
Oshkosh Corporation (OSK - Free Report) has an Earnings ESP of +2.85% and has a Zacks Rank of 2. The company is scheduled to report third-quarter fiscal 2018 results on Jul 31.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>