Cooper Story

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CTB -- USA Stock  

USD 31.09  0.17  0.54%

It looks like Goodyear Tire will continue to recover faster as its price went down 7.21% today to Cooper Tire's 1.15%. As many rational traders are trying to avoid consumer cyclical space, it makes sense to go over Cooper Tire Rubber a little further and understand how it stands against Goodyear Tire and other similar entities. We are going to analyze some of the competitive aspects of both Cooper and Goodyear.
Published over a month ago
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Will Goodyear (NASDAQ:GT) shadow Cooper Tire price appreciation?
By analyzing existing technical and fundamental indicators between Cooper Tire and Goodyear, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Goodyear with a short position in Cooper Tire. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Cooper Tire has an asset utilization ratio of 109.6 percent. This suggests that the company is making $1.1 for each dollar of assets. An increasing asset utilization means that Cooper Tire Rubber is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Cooper or American is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

UNDERSTANDING Cooper Tire dividends

A dividend is the distribution of a portion of Cooper Tire earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Cooper Tire dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Cooper one year expected dividend income is about $0.28 per share.
As of September 29, 2020, Payment of Dividends and Other Cash Distributions is expected to decline to about (22.7 M). In addition to that, Dividend Yield is expected to decline to 0.0147.
Last ReportedProjected for 2020
Payment of Dividends and Other Cash Distributions-21.1 M-22.7 M
Dividend Yield 0.015  0.0147 
Dividends per Basic Common Share 0.38  0.38 
Investing in dividend-paying stocks, such as Cooper Tire Rubber is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Cooper Tire must own a stock before its ex-dividend date to receive its next dividend. This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Cooper Tire. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

How important is Cooper Tire's Liquidity

Cooper Tire financial leverage refers to using borrowed capital as a funding source to finance Cooper Tire Rubber ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Cooper Tire financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Cooper Tire's total debt and its cash.

Correlation Between Cooper and American Axle Manufa

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Cooper Tire together with similar or unrelated positions with a negative correlation. For example, you can also add American Axle to your portfolio. If American Axle is not perfectly correlated to Cooper Tire it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Cooper Tire for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down. Please check pair correlation details between CTB and AXL for more information.


Are you currently holding both Cooper Tire and American Axle in your portfolio? Please note if you are using this as a pair-trade strategy between Cooper Tire and American Axle, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses.

Acquisition by Gerald Bialek of 3000 shares of Cooper Tire subject to Rule 16b-3

Legal trades by Cooper Tire insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Cooper insider trading alert for grant of common stock by Gerald Bialek, VP CFO & Treasurer, on 24th of August 2020. This event was filed by Cooper Tire Rubber Co with SEC on 2020-08-24. Statement of changes in beneficial ownership - SEC Form 4. Gerald Bialek currently serves as interim chief financial officer of Cooper Tire Rubber [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

What is driving Cooper Tire Investor Appetite?

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Now, let's check Cooper Tire revenue. Based on the latest financial disclosure, Cooper Tire Rubber reported 2.67 B of revenue. This is 62.55% lower than that of the Consumer Cyclical sector and 47.42% lower than that of the Auto Parts industry. The revenue for all United States stocks is 71.7% higher than that of Cooper Tire Rubber. As for Goodyear Tire we see revenue of 14.2 B, which is 179.63% higher than that of the Auto Parts

5.1 B
14.2 B
CTB2.67 Billion12.17
Sector5.08 Billion23.14
GT14.2 Billion64.7

Another setback for Cooper Tire investors

Total risk alpha is down to 0.23. It may suggest a possible volatility slip. Cooper Tire Rubber currently demonstrates below-verage downside deviation. It has Information Ratio of 0.12 and Jensen Alpha of 0.57. However, we do advice investors to further question Cooper Tire Rubber expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

The Bottom Line

Whereas other entities in the auto parts industry are either recovering or due for a correction, Cooper may not be as strong as the others in terms of longer-term growth potentials. To sum up, as of the 2nd of August 2020, our final 30 days Buy-Hold-Sell recommendation on the company is Strong Hold. We believe Cooper Tire is currently overvalued with below average probability of distress for the next two years.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of Cooper Tire Rubber. Please refer to our Terms of Use for any information regarding our disclosure principles.

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