Goodyear: The Turnaround Tire Spins In The Wrong Direction

Dhierin BechaiInvesting Group LeaderFollow5ShareSavePlay(7min)CommentsSummaryGoodyear Tire & Rubber Company receives a sell rating due to heightened macro uncertainty and operational headwinds outweighing turnaround progress.Recent margin expansion was largely driven by one-off items, while underlying adjusted operating margins improved only modestly from 7.1% to 7.3%.GT faces significant volume declines, cost inflation, and tariff pressures, with EBITDA projected to fall 15%-30% and free cash flow turning negative.Despite the Goodyear Forward cost program, macro risks and elevated net debt leverage undermine the investment case, with 48% downside risk for 2026.Looking for a helping hand in the market? Members of The Aerospace Forum get exclusive ideas and guidance to navigate any climate. Learn More » 6381380/iStock Editorial via Getty Images Recently, I expanded my coverage to tire companies. In the current uncertain macro landscape, the cyclical nature with high operating leverage that can evaporate is becoming extremely clear for tire companies. In this report, I discuss the investment prospectsThis article was written byDhierin Bechai23.33K FollowersFollowDhierin-Perkash Bechai is an aerospace, defense and airline analyst. Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.