Goodyear Surges 17% Since Reporting In-Line Q4 Earnings

Shares of Goodyear Tire GT gained 17.3% since the company reported fourth-quarter 2024 results on Thursday. It reported fourth-quarter 2024 adjusted earnings per share (EPS) of 39 cents, in line with the Zacks Consensus Estimate. The company reported EPS of 47 cents in the year-ago quarter.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

The company generated net revenues of $4.95 billion, which declined 3.3% on a year-over-year basis due to lower volume but beat the Zacks Consensus Estimate of $4.91 billion.

In the reported quarter, tire volume was 43.6 million units, down 4% from the year-ago period’s levels.

Segmental Performance

In the reported quarter, the Americas segment generated revenues of $2.89 billion, which was almost in line with our estimate but declined 5.8% year over year due to lower replacement volume and an unfavorable price/mix. The segment registered an operating income of $262 million, which fell 15.2% from the year-ago period's figures. The operating income was hit by lower volume, unfavorable price/mix, higher raw material costs and general inflation. The figure also missed our expectation of $270 million.

Revenues in the Europe, Middle East and Africa segment were $1.45 billion, up 3.7% from the year-ago period's levels due to increased tire volume and favorable price/mix. The figure also beat our estimate of $1.41 billion. The operating income for the segment was $41 million, which rose from $6 million in the year-ago quarter as it benefited from the Goodyear Forward plan and the recovery from the previous year’s fire at its Debica, Poland facility. The metric also surpassed our expectation of $27.3 million.

Revenues in the Asia Pacific segment fell 6.8% year over year to $606 million due to lower replacement volume and missed our estimate of $695 million. The segment’s operating profit was $82 million, up 20.6% from the year-ago quarter’s figure, driven by benefits from the Goodyear Forward plan and other lower costs. The figure also topped our estimate of $67 million.

Financial Position

Selling, general & administrative expenses fell to $692 million from $769 million in the year-ago period.

Goodyear had cash and cash equivalents of $810 million as of Dec. 31, 2024, down from $902 million as of Dec. 31, 2023.

Long-term debt and finance leases amounted to $6.39 billion as of Dec. 31, 2024, down from $6.83 billion as of Dec. 31, 2023.

Capital expenditure in the full year was $1.19 billion, up from $1.05 billion reported in 2023.

Outlook for 2025

For 2025, Goodyear expects capital expenditures to be $950 million. It expects interest expenses to be between $450 million and $475 million, and depreciation and amortization to be approximately $925 million.

Zacks Rank and Key Picks

GT currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto space are Dana DAN, Garrett Motion GTX and Custom Truck One Source CTOS. While DAN sports a Zacks Rank #1 (Strong Buy), GTX and CTOS carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DAN’s 2025 earnings has moved north 15.4% over the past 30 days and suggests year-over-year growth of 79.17%. It is currently pegged at $1.50 per share.

The Zacks Consensus Estimate for GTX’s 2025 earnings has moved up by 1 cent over the past 30 days and suggests year-over-year growth of 17.92%. It is currently pegged at $1.25 per share.

The Zacks Consensus Estimate for CTOS’ 2025 loss has remained steady at 5 cents per share over the past 90 days and suggests year-over-year growth of 75.05%.

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