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Whirlpool Stock is an Overlooked Gem

Whirlpool (WHR) manufactures and markets home appliances. It keeps on beating earnings, and its stock keeps on gaining momentum. The stock is an excellent play for both capital...
Whirlpool Stock is an Overlooked Gem © Reuters. Whirlpool Stock is an Overlooked Gem

Whirlpool (WHR) manufactures and markets home appliances. It keeps on beating earnings, and its stock keeps on gaining momentum. The stock is an excellent play for both capital gains and dividends. I am bullish on the stock. (See Whirlpool (NYSE:WHR) stock charts on TipRanks)

Earnings Growth

Whirlpool beat its Q2 earnings expectations by $290 million, extending its quarterly earnings beat streak to twelve. The company also beat its EPS estimates by $0.64, bolstering its phenomenal diluted EPS figure up to $30.00.

Cost-Saving Playing its Part

Whirlpool has spent time focusing on cost-saving initiatives such as reducing structural and discretionary costs by improving its supply chain efficiency, and managing its working capital more effectively.

Examining Whirlpool's margins, it's apparent that its initiatives have been successful. Gross profit margins have increased from 16.25% a year ago to 21.47% a year later, while operating margins have increased twofold (year-over-year) to 12.22%.

Balance Sheet Improvements

Whirlpool has delevered its balance sheet from roughly 110% to 38.5%. Combined with total asset growth of nearly $2 billion, that means intrinsic value has increased sharply.

Dividends

The company declared a quarterly dividend of $1.40 last month, in line with its previous payout. Investors should find comfort in the fact that Whirlpool has increased its dividend for 11 consecutive years, with plenty of capacity left.

Furthermore, Whirlpool's dividend coverage is 95.73% better off than the industry median, and its free cash flow to dividend yield is 192.21% better off relative to its 5-year average. Both these metrics indicate that dividend increases are on the horizon, or rampant share repurchases as an alternative.

Valuation

Whirlpool stock is currently trading below its fair value. The stock's P/E (7.88) and its Price to Book (2.75) ratios are trading below the industry median by 43.55% and 8.90%, respectively.

I'd also like to highlight that the company's free cash flow yield of 17.75% has doubled over the past year while its EV/EBITDA trades 52.22% below the sector median.

A useful valuation technique is to compare the company's free cash flow & EV/EBITDA growth with the price appreciation. If we consider the above mentioned growth rate and relative valuation to a stock price increase of only 28% year-over-year, I think it's safe to say that Whirlpool still has value in abundance.

Wall Street's Take

Wall Street thinks the stock is a hold. I'm afraid I have to disagree with the consensus, and contend that Whirlpool won't only provide investors with a good option for dividend income, but price gains are also on the charts, according to relative valuation metrics.

Disclosure: At the time of publication, Steve Gray Booyens did not have a position in any of the securities mentioned in this article.

Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of Tipranks or its affiliates, and should be considered for informational purposes only. Tipranks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. Tipranks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by Tipranks or its affiliates. Past performance is not indicative of future results, prices or performance.

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24-09-2021 16:53:36 (UTC+7)

EUR/USD

1.1737

0.0001 (0.00%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (6)

Sell (1)

EUR/USD

1.1737

0.0001 (0.00%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (6)

Sell (1)

GBP/USD

1.3708

-0.0008 (-0.06%)

Summary

Sell

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (0)

Sell (9)

USD/JPY

110.39

+0.10 (+0.09%)

Summary

↑ Sell

Moving Avg:

Buy (3)

Sell (9)

Indicators:

Buy (0)

Sell (7)

AUD/USD

0.7269

-0.0026 (-0.36%)

Summary

↑ Sell

Moving Avg:

Buy (4)

Sell (8)

Indicators:

Buy (0)

Sell (6)

USD/CAD

1.2681

+0.0026 (+0.21%)

Summary

Buy

Moving Avg:

Buy (7)

Sell (5)

Indicators:

Buy (5)

Sell (3)

EUR/JPY

129.57

+0.12 (+0.09%)

Summary

Neutral

Moving Avg:

Buy (9)

Sell (3)

Indicators:

Buy (2)

Sell (4)

EUR/CHF

1.0828

-0.0016 (-0.15%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (9)

Gold Futures

1,754.50

+4.70 (+0.27%)

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↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (9)

Silver Futures

22.657

-0.022 (-0.10%)

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↑ Sell

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Sell (12)

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Copper Futures

4.2275

-0.0035 (-0.08%)

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↑ Sell

Moving Avg:

Buy (2)

Sell (10)

Indicators:

Buy (0)

Sell (11)

Crude Oil WTI Futures

73.39

+0.09 (+0.12%)

Summary

↑ Sell

Moving Avg:

Buy (4)

Sell (8)

Indicators:

Buy (0)

Sell (11)

Brent Oil Futures

77.46

+0.21 (+0.27%)

Summary

↑ Sell

Moving Avg:

Buy (1)

Sell (11)

Indicators:

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Sell (10)

Natural Gas Futures

5.091

+0.115 (+2.31%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (9)

Sell (0)

US Coffee C Futures

193.10

+2.50 (+1.31%)

Summary

↑ Buy

Moving Avg:

Buy (10)

Sell (2)

Indicators:

Buy (5)

Sell (1)

Euro Stoxx 50

4,153.20

-41.72 (-0.99%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (9)

S&P 500

4,448.98

+53.34 (+1.21%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (1)

Sell (9)

DAX

15,513.45

-130.52 (-0.83%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (8)

FTSE 100

7,052.25

-26.10 (-0.37%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (9)

Hang Seng

24,192.16

-318.82 (-1.30%)

Summary

↑ Buy

Moving Avg:

Buy (8)

Sell (4)

Indicators:

Buy (7)

Sell (0)

US Small Cap 2000

2,259.80

+41.24 (+1.86%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (1)

Sell (7)

IBEX 35

8,857.50

-19.40 (-0.22%)

Summary

↑ Sell

Moving Avg:

Buy (1)

Sell (11)

Indicators:

Buy (0)

Sell (8)

BASF SE NA O.N.

63.665

-0.255 (-0.40%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (8)

Bayer AG NA

46.30

-0.18 (-0.39%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (7)

Allianz SE VNA O.N.

191.98

+0.46 (+0.24%)

Summary

↑ Sell

Moving Avg:

Buy (2)

Sell (10)

Indicators:

Buy (0)

Sell (10)

Adidas AG

280.85

-8.13 (-2.81%)

Summary

↑ Sell

Moving Avg:

Buy (1)

Sell (11)

Indicators:

Buy (0)

Sell (6)

Deutsche Lufthansa AG

6.198

-0.003 (-0.05%)

Summary

Buy

Moving Avg:

Buy (7)

Sell (5)

Indicators:

Buy (5)

Sell (1)

Siemens AG Class N

148.73

-1.49 (-0.99%)

Summary

↑ Sell

Moving Avg:

Buy (1)

Sell (11)

Indicators:

Buy (0)

Sell (8)

Deutsche Bank AG

10.736

+0.081 (+0.76%)

Summary

Neutral

Moving Avg:

Buy (8)

Sell (4)

Indicators:

Buy (2)

Sell (6)

 EUR/USD1.1737↑ Buy
 GBP/USD1.3708Sell
 USD/JPY110.39↑ Sell
 AUD/USD0.7269↑ Sell
 USD/CAD1.2681Buy
 EUR/JPY129.57Neutral
 EUR/CHF1.0828↑ Sell
 Gold1,754.50↑ Sell
 Silver22.657↑ Sell
 Copper4.2275↑ Sell
 Crude Oil WTI73.39↑ Sell
 Brent Oil77.46↑ Sell
 Natural Gas5.091↑ Buy
 US Coffee C193.10↑ Buy
 Euro Stoxx 504,153.20↑ Sell
 S&P 5004,448.98↑ Sell
 DAX15,513.45↑ Sell
 FTSE 1007,052.25↑ Sell
 Hang Seng24,192.16↑ Buy
 Small Cap 20002,259.80↑ Sell
 IBEX 358,857.50↑ Sell
 BASF63.665↑ Sell
 Bayer46.30↑ Sell
 Allianz191.98↑ Sell
 Adidas280.85↑ Sell
 Lufthansa6.198Buy
 Siemens AG148.73↑ Sell
 Deutsche Bank AG10.736Neutral
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank5,655/ 5,705
(-20/ -20) # 874
SJC HCM5,640/ 5,705
(-30/ -30) # 874
SJC Hanoi5,640/ 5,707
(-30/ -30) # 876
SJC Danang5,640/ 5,707
(-30/ -30) # 876
SJC Nhatrang5,640/ 5,707
(-30/ -30) # 876
SJC Cantho5,640/ 5,707
(-30/ -30) # 876
Cập nhật 24-09-2021 16:53:39
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ↀ Giá vàng thế giới
$1,755.25+9.440.54%
Live 24 hour Gold Chart
ʘ Giá bán lẻ xăng dầu
Sản phẩmVùng 1Vùng 2
RON 95-IV2149021910
RON 95-II,III2139021810
E5 RON 92-II2014020540
DO 0.05S1602016340
DO 0,001S-V1637016690
Dầu hỏa1508015380
ↂ Giá dầu thô thế giới
WTI$73.39-0.63-0.86%
Brent$77.46-0.93-1.19%
$ Tỷ giá Vietcombank
Ngoại tệMua vàoBán ra
USD22.630,0022.860,00
EUR26.044,7927.400,28
GBP30.430,7031.702,11
JPY200,85212,47
KRW16,7620,40
Cập nhật lúc 16:48:37 24/09/2021
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