Bridgestone Shares Pumped Up

SHARES in Bridgestone Corp, the world’s largest tire maker by sales, rose to their highest in more than eight months yesterday after Goldman Sachs Group Inc and UBS AG upgraded the company’s stocks to "buy" on price increases in the United States.

     
Bridgestone is raising prices this month in the American replacement-tire market for the third time this year. Falling crude-oil prices, lower natural-rubber costs, and a weaker yen will also boost earnings, according to UBS analyst Kunihiro Matsumoto.

    
"We think the shares do not factor projected price-hike benefits," wrote Goldman analyst Toru Yaezawa in a report on Wednesday.

    
Crude-oil prices have declined 25 percent from a record US$147.27 a barrel on July 11. Petroleum accounts for at least half the raw-material cost of a tire,according to analysts. Rubber prices have also fallen 11 percent from a recentpeak of 356.9 yen on June 30.

 

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