Goodyear share price picks up, hedge funds back Goodyear

Goodyear’s share price picked up by up to 1 per cent during early trading on 12 December 2018, having risen 0.56 per cent by the close of the previous session (up from $21.59 to $21.71). Considering that the value of these shares fell -8.70 per cent during the preceding seven-day period, and experienced a loss of -1.76 per cent over the past 30-day period suggests this is a significant uptick. In addition, when you compare this with the 1.5 per cent one-day drop all tyre majors experienced in October when Michelin warned that demand was softening, it appears that the share price is bouncing back.

Indeed, the Goodyear share price has risen 12.78 per cent compared to its 90-day low. The fact that it is also 12.64 per cent under its 90-day high suggests some investors are deciding to back Goodyear once again. According to financial news sources, Trendspotter rated the Goodyear shares as “Hold”. Morgan Stanley, on the other hand, downgraded Goodyear from “Overweight ” to “ Equal-Weight”.

Meanwhile Insider Monkey reports that 700 13F SEC filings (the notice that hedge funds and prominent investors are required to give) have been submitted. To put this in perspective, Goodyear shares were in 25 hedge funds’ portfolios at the end of the third quarter of 2018.

Comparable stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $108 million. In Goodyear’s case that figure was U$654 million. Furthermore, calculations also showed that Goodyear isn’t among the 30 most popular stocks of hedge funds, suggesting something has changed in their estimation of the US tyre manufacturer.

On 30 October 2018 Moody’s Investors Service revised down the rating outlook of The Goodyear Tire & Rubber Company to negative from stable. In a related action Moody’s affirmed Goodyear’s other ratings including Corporate Family and Probability of Default rating at Ba2, Ba2-PD, respectively.