For a publicly held company, what could be better than making Wall Street eat its words, when those words uniformly are negative?
For several years, the status of Goodyear in the world's investment community was somewhere close to junk. The company was reeling from bad decisions, bad luck and difficult market conditions, and its stock showed it. In 2003, Goodyear's share price tumbled to $4, and that was only five years removed from when it sold for $75.
Wall Street, hardly enamored with basic manufacturing industries anyway, sniffed and smelled bankruptcy.
Goodyear started a difficult climb back that, frankly, some stock watchers felt would end in a fall. Some still do.
Goodyear had hard choices to make, and it embraced them. The key has been a total focus on its core tire-manufacturing business and the jettisoning of anything else. The company sold its North American farm tire business, its tire fabric operations, a rubber plantation, its adhesive resins business and the profitable Engineered Products division.
It bailed out of low-margin products or moved production to cheaper, overseas sites. The company concentrated on higher-profit lines. Cutting costs by at least $1.8 billion by 2009 has been a prime goal, and today it looks achievable.
The result has been resurgent profits, combined with some record sales. Even the company's North American tire operations, which were in deep trouble not long ago, posted a $66 million operating profit in the third quarter.
The company's share price, too, has recovered. It has gone as high as $36, and remains in the $29 range, a far cry from that $4 price of just a few years ago.
As one analyst put it, some companies that have a near-death experience but restructure and pull out of the decline often re-emerge as top performers. Goodyear hasn't gotten a clean bill of health yet-its debt, while much-reduced, remains high, and the rising cost of oil could have a dampening effect on its recovery. But the company certainly no longer is on life support.