Wednesday, November 20, 2019
GOODYEAR WILL IT SURVIVE THIS ECONOMY Research Paper
GOODYEAR WILL IT SURVIVE THIS ECONOMY - Research Paper Example Ratio Industry Comparison 1.5x Quick Ratio Industry Comparison 0.9x LONG-TERM SOLVENCY - GOODYEAR TIRE & RUBBER CO (GT) Total Debt/Equity Industry Comparison 315.3x Total Liabilities/Total Assets Industry Comparison 90.4x GROWTH OVER PRIOR YEAR - GOODYEAR TIRE & RUBBER CO (GT) Total Revenue Industry Comparison 15.53% Tangible Book Value Industry Comparison 48.15% EBITDA Industry Comparison 56.89% Gross Profit Industry Comparison 27.36% Receivables Industry Comparison 8.03% Inventory Industry Comparison 21.86% Diluted EPS Before Extra Industry Comparison -42.58% Capital Expenditures Industry Comparison 26.54% Cash From Ops. ... ble Book Ratio -18.03 Most recent dataà à à 5-Year Averages Return on Assets -0.5% Return on Invested Capital -1.4% Gross Profit Margin 20.8% Pre-Tax Profit Margin 0.1% Post-Tax Profit Margin -0.9% Net Profit Margin (Total Operations) -0.4% R&D as a % of Sales 0.0% SG&A as a % of Sales 13.8% Debt/Equity Ratio 5.24 Total Debt/Equity Ratio 5.83 Price Earnings Ratios P/E Ratio 26 Weeks Ago 17.9 12 Month Normalized P/E Ratio 150.1 GT Ratios & Returns Price-to-sales 0.2 Return on Equity 0.0 Operating Margin 7.6 Profit Margin -1.1% More GT Ratios & Returns > GT Financials Sales $18.832 bil Profits $-0.216 bil Assets $15.63 bil Employees 72000.0 ANALYSIS Goodyear is a prestigious company that has dominated the market by producing tire, rubber, and glass products. Recently, the company has recorded profits of $16,302 million at the fiscal year of 2009. This was a disappointing figure considering the fact that the company has a revenue increase of 16% in 2009. The net loss for the comp any was $375 million, compared to last year which was only around $77 million. Hence, the companyââ¬â¢s revenue stream was declined 16% from last year. The companyââ¬â¢s financial ratios no doubt indicate that the company is facing tough times. For instance, the net loss in their operations is a drastic $375 million. This type of deficit will not enable the company to thrive in these harsh economic times. Furthermore, the companyââ¬â¢s earnings per share is extremely low, which raises the questions for the stockholders. The return on investment capital is -1.4%, which means that the company has low funds to buy fixed assets. The price/tangible book ratio is -18.03, which means the stock is undervalued. The company must need to address this issue immediately in order for the company to be marginal. In
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