Goodyear vs Ferrari Which Is More Profitable?

Goodyear and Ferrari are two well-known companies in the automotive industry, but their stocks have had very different trajectories in recent years. Goodyear, a tire manufacturer, has struggled with declining sales and increasing competition from lower-cost alternatives. Ferrari, on the other hand, is a luxury sports car manufacturer known for its high-performance vehicles and strong brand recognition. Investors may need to carefully consider the financial performance and market dynamics of these two companies before making any investment decisions.

Goodyear or Ferrari?

When comparing Goodyear and Ferrari, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Goodyear and Ferrari.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Goodyear has a dividend yield of 4.44%, while Ferrari has a dividend yield of 0.58%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Goodyear reports a 5-year dividend growth of 0.00% year and a payout ratio of 174.40%. On the other hand, Ferrari reports a 5-year dividend growth of 22.88% year and a payout ratio of 31.34%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Goodyear P/E ratio at 39.24 and Ferrari's P/E ratio at 55.09. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Goodyear P/B ratio is 0.32 while Ferrari's P/B ratio is 24.64.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Goodyear has seen a 5-year revenue growth of 0.62%, while Ferrari's is 0.82%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Goodyear's ROE at 0.82% and Ferrari's ROE at 45.21%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ฿157.50 for Goodyear and $451.82 for Ferrari. Over the past year, Goodyear's prices ranged from ฿135.00 to ฿197.50, with a yearly change of 46.30%. Ferrari's prices fluctuated between $330.15 and $498.23, with a yearly change of 50.91%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.