Yahoo Finance Is Now An Opportune Moment To Examine The Goodyear Tire & Rubber Company (NASDAQ:GT)?
The Goodyear Tire & Rubber Company (NASDAQ:GT), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NASDAQGS. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s examine Goodyear Tire & Rubber’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
See our latest analysis for Goodyear Tire & Rubber
Is Goodyear Tire & Rubber Still Cheap?
Good news, investors! Goodyear Tire & Rubber is still a bargain right now. According to my valuation, the intrinsic value for the stock is $17.76, but it is currently trading at US$10.97 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Goodyear Tire & Rubber’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What does the future of Goodyear Tire & Rubber look like?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with a negative profit growth of -14% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Goodyear Tire & Rubber. This certainty tips the risk-return scale towards higher risk.
What This Means For You
Are you a shareholder? Although GT is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to GT, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping tabs on GT for some time, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
If you'd like to know more about Goodyear Tire & Rubber as a business, it's important to be aware of any risks it's facing. Case in point: We've spotted 1 warning sign for Goodyear Tire & Rubber you should be aware of.
If you are no longer interested in Goodyear Tire & Rubber, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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