We came across a bullish thesis on The Goodyear Tire & Rubber Company on Value investing subreddit by TheVariantView. In this article, we will summarize the bulls’ thesis on GT. The Goodyear Tire & Rubber Company’s share was trading at $9.45 as of January 28th. GT’s trailing and forward P/E were 5.12 and 12.09 respectively according to Yahoo Finance.
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The Goodyear Tire & Rubber Company, together with its subsidiaries, develops, manufactures, distributes, and sells tires and related products and services worldwide. GT is positioned as one of the most compelling industrial turnarounds, currently trading at a distressed valuation of $8.73 despite entering its most profitable phase in a decade. The company has transformed from a debt-laden, legacy cyclical manufacturer into a lean, margin-focused premium tire producer, a shift largely driven by activist investor Elliott Investment Management.
Elliott’s 10% stake and board influence initiated the Strategic and Operational Review Committee, resulting in the Goodyear Forward plan, which has already delivered $2.2 billion in gross proceeds through the divestiture of non-core OTR, Dunlop, and Chemical businesses. This capital has enabled debt reduction and funding for high-return modernization projects, positioning the company for sustainable profitability.
Operationally, Goodyear is investing $320 million in its Lawton, Oklahoma facility to expand production by 10 million units of 18-inch-plus premium tires for EVs and autonomous vehicles, securing USMCA-compliant supply and avoiding $350 million in annual tariff costs faced by low-cost Asian competitors.
Despite market skepticism around low-end imports, inventory, and margin realization, management has consistently exceeded targets, raising its annualized run-rate savings to $1.5 billion by 2025. Retiring $500 million in high-interest notes will generate $70 million in annual interest savings, further boosting EPS. Major new OEM fitments with Volkswagen, Toyota, and Geely are also ramping, ensuring high-margin replacement business over time.
Goodyear’s stock remains undervalued, trading at a forward P/E of 7.2x versus sector peers at approximately 10x, implying nearly 50% upside if the market re-rates the company to reflect its transformation, operational efficiency, and strong growth trajectory, making it an attractive risk/reward opportunity in the industrial sector.
Previously, we covered a bullish thesis on Goodyear Tire & Rubber (GT) by a Value investing subreddit contributor in March 2025, which highlighted the company’s financial stability, free cash flow generation, and potential for gradual operational improvement. GT’s stock price has depreciated by approximately 3.47% since our coverage due to skepticism about the turnaround’s execution. TheVariantView shares a similar thesis but emphasizes Elliott Management’s Goodyear Forward plan and high-margin modernization driving sustainable profitability.