| StockTradersPress.com |
| A
Corporate Communications Corp. Publication ---- All Rights
Reserved |
| Short-Term
Report |
May 11, 2004 |
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| UPDATE - STRONG
BUY |
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| Goodyear Tire & Rubber
Comapny (NYSE) GT |
$ 8.13 |
| 52-week range |
$4.49-$11.97 |
| Market Cap |
$1.14B |
| Shares Outstanding |
175.3M |
| Book Value |
$3.27 |
| Price/Book |
2.45 |
| Average Daily Vol. |
2.80M |
| Target Price |
$13.00 |
| Target Percentage |
60% |
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| Goodyear
Tire is the world’s largest tire manufacturer. In addition
to tires, the company produces engineered rubber products such
as bumpers and specialty chemicals. |
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| We are
attracted to Goodyear Tire for the following reasons: |
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- The newly restructured company has
entailed a realignment of management functions and a closure
of a number of plants. Consequently, Goodyear Tire
has meaningfully improved its cost structure.
- In addition to its operational
restructuring, Goodyear Tire has substantially
improved its dealer network, which is most important.
- We believe that as the economy
continues to improve, Goodyear Tire will
participate as demand for tires for the OEM market and the
replacement markets increases. Also, the specialty chemical
business will improve as pricing firms up.
- Recently the Chinese government
has issued new regulation regarding extending credit to
consumers for automobile purchases. This is an important
development since the vast majority of Chinese consumers
normally purchase an automobile for 100% cash.
- At its current price of
$8.13 per share, we believe the price does not reflect the
improving environment for Goodyear Tire and thus we view
the stock as undervalued.
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We
are establishing a target price of $13.00 per share.
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