-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:
Goodyear Tire & Rubber (GT) posted Q1 adjusted EPS of -$0.39 vs. -$0.04, ahead of the -$0.43 consensus. The beat was due to stronger-than-expected sales, as revenue fell 8.7% to $3.88B ($70M ahead of consensus) on an 11.6% drop in tire sales volume, partially offset by higher prices. Segment operating margin contracted 220 bps to 2.4%. The quarter was marked by weak demand in tire markets across the majority of its key geographies. Looking ahead, management said it expects increased pressure on tire industry demand and higher raw material costs stemming from the Middle East conflict, which will require continued meaningful actions to strengthen its cost structure. GT shares are currently trading 2% lower after hours due to the cautious guidance. GT continues to face demand-related issues, and the recent spike in oil prices should equate to meaningful pressures on profitability, as approximately two-thirds of GT's raw materials costs are petroleum-based (and it doesn't hedge commodity prices).