Whirlpool (WHR) Down 5.3% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Whirlpool (WHR). Shares have lost about 5.3% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Whirlpool due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers. Whirlpool Q4 Earnings Beat, Soft 2025 ViewWhirlpool posted fourth-quarter 2024 results, wherein earnings beat the Zacks Consensus Estimate and increased year over year. However, the top line declined year over year and missed the Zacks Consensus Estimate.The company made progress in its operations, delivering on the cost takeout commitment of $300 million while achieving the closure of the Europe transaction. For 2025, the company expects to deliver more than $200 million in cost takeouts and position the business for the eventual U.S. housing recovery.Whirlpool’s Quarterly Performance: Key Metrics and InsightsThe appliance maker reported fourth-quarter adjusted earnings per share (EPS) of $4.57, surpassing the Zacks Consensus Estimate of $4.39 and improving 18.7% year over year.Net sales of $4.14 billion missed the Zacks Consensus Estimate of $4.27 billion and declined 18.7% year over year. Excluding the unfavorable impacts of foreign exchange, organic net sales were $4.17 billion, up 1.9% year over year.Quarterly gross profit was $671 million, down 15.3% from $792 million reported in the year-ago quarter. The gross margin expanded 60 basis points (bps) year over year to 16.2%.Selling, general and administrative (SG&A) expenses declined 25% year over year to $418 million. As a percentage of net sales, SG&A expenses declined 80 bps year over year to 10.1%. The ongoing EBIT of $248 million declined 6.8% from $266 million in the year-ago quarter. The ongoing EBIT margin of 6% expanded 80 bps year over year.Region Wise Performance DetailsNet sales for the MDA North America segment declined 1.4% year over year to $2.6 billion. Excluding currency, net sales decreased 1.2% year over year. This decline was primarily driven by a significant reduction in trade inventory along with strong quarterly sell-through, which affected the price and product mix. The segment’s EBIT decreased 18.8% year over year to $173 million, while the EBIT margin contracted 140 bps to 6.7% owing to adverse price/mix. The Zacks Consensus Estimate for net sales of the MDA North America segment was pegged at $2.73 billion.Net sales from MDA Latin America declined 4% year over year to $920 million. Excluding currency, the segment’s sales rose 7.3% year over year, driven by higher industry demand in Brazil and Mexico. The segment’s EBIT of $70 million advanced 40% year over year. The EBIT margin increased 240 bps year over year to 7.6%, attributable to fixed cost leverage and cost take-out actions. The Zacks Consensus Estimate for net sales of the MDA Latin America segment was pegged at $930 million.Net sales in MDA Asia increased 7.6% year over year to $238 million. Excluding the currency impacts, sales rose 8.8% due to higher volume from share gains and industry growth. The segment’s EBIT of $3 million compared with a loss of $1 million reported in the year-ago quarter. Segmental EBIT margin of 1.2% expanded 170 bps from negative 0.5% in the prior-year quarter, benefiting from fixed cost leverage. The Zacks Consensus Estimate for net sales of the MDA Asia segment was pegged at $201 million.Net sales in SDA Global increased 5.7% year over year to $384 million. Excluding the currency impacts, sales increased 6.4% due to growth from new product launches and robust direct-to-consumer business. The segment’s EBIT of $48 million reflected a 4% decrease from $50 million reported in the year-ago quarter. Segmental EBIT margin of 12.5% contracted 130 bps from 13.8% in the prior-year quarter due to continued marketing investments in new product launches. The Zacks Consensus Estimate for net sales of the SDA Global segment was pegged at $417 million.Whirlpool’s Financial Health SnapshotWhirlpool ended the fourth quarter with cash and cash equivalents of $1.28 billion, long-term debt of $4.76 billion and total stockholders’ equity of $2.93 billion.For fiscal 2024, Whirlpool provided cash of $835 million from operating activities and reported a free cash flow of $385 million. The company incurred capital expenditure of $451 million in the same period.2025 OutlookWhirlpool provided its sales guidance for 2025, anticipating net sales of $15.8 billion, down from $16.6 billion reported in the year-ago period. The company anticipates an ongoing EBIT margin of 6.8%, indicating a rise from 5.3% reported in 2023.Whirlpool expects its GAAP EPS for 2025 to be $8.75 compared with a loss of $5.87 per share. Ongoing EPS is expected to be $10, down from $12.21 per share reported in 2024. The ongoing earnings guidance includes approximately $200 million of cost actions.Cash provided by operating activities is expected to be nearly $1 billion, with an estimated free cash flow of roughly $500-$600 million. The company intends to reduce its ownership stake in Whirlpool of India Ltd. to 20% in 2025 through market sales. It expects net cash proceeds of $550-$600 million from the anticipated India transaction. The company anticipates paying down debt of roughly $700 million in 2025.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in fresh estimates.The consensus estimate has shifted -47.48% due to these changes.VGM ScoresCurrently, Whirlpool has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Whirlpool has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Whirlpool Corporation (WHR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks