Goodyear Tire stock jumps nearly 5% after profit, sales rises above expectations

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Shares of Goodyear Tire & Rubber Co. GT, +1.75% jumped 4.9% toward a two-month high in premarket trading Friday, after the tire maker reported second-quarter profit and sales that rose above expectations. The upbeat results were a welcome relief to investors, as the stock tumbled 9.5% the day first-quarter results were reported, and 27.4% after fourth quarter results, which was the biggest one-day selloff since October 1987. “Our second quarter and first half sales were the highest in a decade, reflecting the recent addition of Cooper Tire, the benefit of strong pricing actions across many of our key markets, and volume growth,” said Chief Executive Richard Kramer. Net income for the quarter to June 30 rose to $166 million, or 67 cents a share, from $67 million, or 27 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of 46 cents beat the FactSet consensus of 36 cents. Sales grew 31.0% to $5.21 billion, above the FactSet consensus of $5.04 billion, as tire unit volumes rose 21%. Cost of goods sold rose more than sales, up 35.5% to $4.17 billion, as gross margin contracted to 20.0% from 22.6%. The stock has tumbled 41.0% year to date through Thursday, while the S&P 500 SPX, -0.97% has lost 12.9%.

This article was originally published by Marketwatch.com. Read the original article here.

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