Value
8.1/10data confidence 83%| Component | Sub-score |
|---|---|
| P/S | 10.0 |
| EV/EBITDA | 7.0 |
| Fwd P/E | 9.3 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 10.2x
- ▸PEG: 0.09
- ▸Attractively valued
GT · Why this verdict
Why The Goodyear Tire & Rubber Comp (GT) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality scores substantially below the threshold for a sound investment, with no discernible competitive moat, near-zero operating margins, and broad impairment across every key quality metric including return on assets, gross margin, and net margin. Quality breakdown | If this pillar proves wrong, the business establishes a positive operating margin for at least 2 consecutive quarters and the Piotroski financial health score rises above 6 out of 9. | →Stable |
| CounterCompanies in capital-intensive commodity industries often carry structurally thin margins that can improve sharply when raw material costs fall; if input cost deflation materializes, a near-zero-margin operation can see rapid earnings recovery without any structural competitive change. | ||
Revenue has declined approximately 9% year-over-year while operating margins are near zero, a combination that compresses the financial cushion and limits the company's ability to invest in its competitive position or service its debt load. Growth breakdown | If this pillar proves wrong, year-over-year revenue growth turns positive and operating margin expands above 5% for 2 consecutive quarters. | →Stable |
| CounterA forward price-to-earnings of 8.6 times already prices in a degree of cyclical weakness; if auto production volumes normalize and raw material costs ease, both revenue and margins can rebound meaningfully from a low base at a multiple that provides little premium. | ||
The two most recent quarterly results were both misses — with the latest quarter delivering a 56% negative surprise — after two strong beats in the prior year, suggesting the earnings trajectory has deteriorated rather than representing a one-quarter stumble. Earnings | If this pillar proves wrong, the company posts a positive earnings surprise in the next quarterly report and EPS turns positive on a trailing basis. | →Stable |
| CounterThe extreme magnitude of the prior beats — including a 443% positive surprise three quarters ago — shows the business can swing dramatically; conservatively set guidance could again produce outsized beats even from a weak baseline. | ||
The stock trades below its 200-day moving average with a confirmed declining slope of negative 6.4% over 30 days, while a put/call ratio of 1.40 and short interest of 15% of float reflect significant institutional skepticism about the near-term outlook. Momentum breakdown | If this pillar proves wrong, the stock reclaims and holds above the 200-day moving average for at least 30 consecutive days and short interest declines below 10%. | →Stable |
| CounterA rising MACD alongside an RSI near 66 suggests short-term buying momentum is building even within the downtrend; elevated short positioning creates fuel for a mechanical squeeze if any positive catalyst emerges. | ||
Business quality scores substantially below the threshold for a sound investment, with no discernible competitive moat, near-zero operating margins, and broad impairment across every key quality metric including return on assets, gross margin, and net margin.
→StableQuality breakdown
- Expectation
- If this pillar proves wrong, the business establishes a positive operating margin for at least 2 consecutive quarters and the Piotroski financial health score rises above 6 out of 9.
CounterCompanies in capital-intensive commodity industries often carry structurally thin margins that can improve sharply when raw material costs fall; if input cost deflation materializes, a near-zero-margin operation can see rapid earnings recovery without any structural competitive change.
Revenue has declined approximately 9% year-over-year while operating margins are near zero, a combination that compresses the financial cushion and limits the company's ability to invest in its competitive position or service its debt load.
→StableGrowth breakdown
- Expectation
- If this pillar proves wrong, year-over-year revenue growth turns positive and operating margin expands above 5% for 2 consecutive quarters.
CounterA forward price-to-earnings of 8.6 times already prices in a degree of cyclical weakness; if auto production volumes normalize and raw material costs ease, both revenue and margins can rebound meaningfully from a low base at a multiple that provides little premium.
The two most recent quarterly results were both misses — with the latest quarter delivering a 56% negative surprise — after two strong beats in the prior year, suggesting the earnings trajectory has deteriorated rather than representing a one-quarter stumble.
→StableEarnings
- Expectation
- If this pillar proves wrong, the company posts a positive earnings surprise in the next quarterly report and EPS turns positive on a trailing basis.
CounterThe extreme magnitude of the prior beats — including a 443% positive surprise three quarters ago — shows the business can swing dramatically; conservatively set guidance could again produce outsized beats even from a weak baseline.
The stock trades below its 200-day moving average with a confirmed declining slope of negative 6.4% over 30 days, while a put/call ratio of 1.40 and short interest of 15% of float reflect significant institutional skepticism about the near-term outlook.
→StableMomentum breakdown
- Expectation
- If this pillar proves wrong, the stock reclaims and holds above the 200-day moving average for at least 30 consecutive days and short interest declines below 10%.
CounterA rising MACD alongside an RSI near 66 suggests short-term buying momentum is building even within the downtrend; elevated short positioning creates fuel for a mechanical squeeze if any positive catalyst emerges.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Goodyear Tire presents a combination of below-minimum business quality, declining revenue, two consecutive earnings misses in the most recent quarters, and confirmed technical weakness that makes it difficult to construct a credible investment case at current levels, with the stock offering essentially no upside to its near-term ceiling and an unfavorable risk/reward.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
1.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.6 |
| Gross margin | 0.0 |
| Op margin | 0.1 |
| Net margin | 0.0 |
| Current ratio | 4.1 |
| Moat | 2.5 |
| Piotroski F | 4.4 |
- ▸No competitive moat
- ▸Quality concerns
Growth
5.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.3 |
| EPS growth | 10.0 |
- ▸Declining revenue: -9%
Momentum
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.9 |
| MACD | 7.7 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 10.0 |
| vol acceleration | 10.0 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -4.8%/30d — confirmed downtrend
- ▸Volume surge (4.5x avg) on up move
Sentiment
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 3.2 |
| Analyst rating | 5.0 |
| Price target | 6.9 |
- ▸LLM news sentiment: -0.36 (n=10)
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
2.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.4 |
| quality rank | 0.0 |
| growth rank | 0.9 |
Technical
2.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.3 |
| support resistance | 2.2 |
| 52w position | 1.0 |
| gap | 5.0 |
Risk (lower is worse)
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.8 |
| days to cover | 6.2 |
| volatility | 0.0 |
| put call | 5.3 |
| implied vol | 2.4 |
| beta | 6.5 |
| debt equity | 2.5 |
| news risk | 3.0 |
- ▸High short interest justified: 17%
- ▸High IV: 66%
Catalyst
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (6)
- MOMENTUM:7.9>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-0.1=NEGATIVE
- 8K_SERIOUS:2.05
Warning (1)
- DEATH_CROSS:momentum=7.9>=5.0 recovering
Reward-to-Risk
-0.10
Upside
-1.6%
Downside
14.9%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 61
EdgeInst Constrain — Small cap ($1.9B) below institutional reach
SuitabilitySpeculative — Drawdown -45% (>40% off 52w high)
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 8.1 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:-0.1=NEGATIVE.
The strongest dimensions are Value at 8.1, Momentum at 7.9, and Growth at 5.2; the weakest are Quality at 1.5, Technical at 2.6, and Peer rank at 2.6. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.10 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Well Below Minimum
Trip ifOperating margin turns positive and exceeds 2% for 2 consecutive quarters.
- P2Revenue Decline Margin Pressure
Trip ifRevenue growth turns positive above 0% year-over-year for 2 consecutive quarters.
- P3Consecutive Earnings Misses
Trip ifEPS surprise exceeds 5% for 2 consecutive quarters.
- P4Technical Weakness Institutional Skepticism
Trip ifPrice rises above the 200-day moving average and holds there for 30 consecutive days.