Goodyear Tire & Rubber Shares Plunged: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of  Goodyear Tire & Rubber (NYS: GT) rose more than 10% in early trading after CFO Darren Wells gave investors hope for its first profitable year since 2007.

So what: Wells told the audience at the J.P. Morgan Auto conference in Detroit that Goodyear was successfully offsetting rising raw-materials costs with a strategy of targeted pricing and marketing of higher-priced tires, The Associated Press reported.

Now what: Color me surprised that investors were surprised by this news. Just two weeks ago, Goodyear reported blowout second-quarter earnings, thanks in part to a much higher gross margin. Signs were already pointing to tight cost controls -- Wells merely reaffirmed what we already knew. Do you agree? Disagree? Weigh in using the comments box below.

Interested in more info on Goodyear Tire & Rubber?Add it to your watchlist.

At the time this article was published Fool contributorTim Beyersis a member of theMotley Fool Rule Breakersstock-picking team. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim'sportfolio holdingsandFoolish writings, or connect with him onGoogle+or Twitter, where he goes by@milehighfool. You can also get his insightsdelivered directly to your RSS reader.Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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