Goodyear Tire & Rubber
Another deeply discounted value stock that could double in a Biden bull market is Goodyear Tire & Rubber (NASDAQ:GT). Even after its recent surge, shares of the company can be bought for roughly 11 times forward-year earnings.
The macro catalyst for the highly cyclical Goodyear is the expected rebound in the U.S. and global economy. When U.S. and global gross domestic product are increasing, it's common to see businesses and consumers spending more. That means an expected uptick in business and personal vehicle purchases (i.e., more tires sold).
What's more, rubber future have retraced about 20% from their one-year high set in January. For Goodyear, this means lower input costs and potentially higher margins when demand for tires really picks up.
Wall Street also seems pleased with the company's $2.8 billion cash-and-stock deal to buy rival Cooper Tire & Rubber. Combining these two companies will enhance Goodyear's leading U.S. market share, broaden its product portfolio in the high-margin light truck and SUV segments, nearly double its presence in the fast-growing China tire market, and lead to an estimated $165 million in cost-savings over the next two years. Suffice it to say, Goodyear could be burning rubber for its shareholders for years to come.
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