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Key Takeaways
- Whirlpool shares fell in pre-market trading Tuesday after the home appliances maker announced 2024 sales and earnings forecasts that fell short of Wall street expectations, as higher expenses and competition from rivals weigh on the company’s results.
- The company said it expects to cut an additional $300 to $400 million in costs this year.
- Although Whirlpool shares remain in a long-term downtrend, a break above a key horizontal line around $125 could potentially shift momentum back to the upside.
Whirlpool Corporation
Source: TradingView.com.
Shares in home appliance manufacturer Whirlpool Corporation (WHR) tumbled over 4% in pre-market trading Tuesday morning after the company fell short of Wall Street’s full-year earnings and sales forecasts. The maker of Maytag washers and dryers said it expects 2024 earnings to range between $13 and $15 per share on sales of $16.9 billion. Analysts had projected earnings of $15.48 a share on revenue of $17.68 billion. Moreover, the company’s top line forecast represents a 13% contraction from the previous year, with management citing higher expenses and a challenging competitive environment for the weaker outlook.
The Michigan-based company, which slashed about $800 million in expenses in 2023, said it anticipates cutting an additional $300 to $400 million in costs this year. The announcement of further cost-cutting measures comes several months after the white goods maker said it planned to sell a 24% stake in its India business in order to reduce debt. On the competitive front, the company faces growing pricing pressure from international rivals, such as China’s Midea, Sweden’s Electrolux, and Germany’s Bosch, as cash-strapped consumers shop around for competitive deals.
In better news, an uptick in industry demand and a slight improvement in North American market share helped the company report a fourth quarter profit of $491 million, or $8.90 a share, reversing a loss of $1.61 billion or $29.35 a share in the prior year’s quarter.
The WHR share price remains entrenched within a long-term downtrend, making lower lows and lower highs. However, after temporarily breaking below $100 a share, the price has managed to claw back above the 50-day moving average. In upcoming trading sessions, keep an eye if the stock can break above a key horizontal line connecting the March swing low and December swing high around $125, a move that could potentially shift momentum back to the upside.
Whirlpool shares were down 4.7% at $112.27 about 90 minutes before Tuesday’s opening bell. The stock has lost nearly a quarter of its value over the past year.
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