Whirlpool has been depressed recently due largely to investors resistance to own stocks tied in to U.S. housing. Appliances are far less discretionary in comparision to carpet, cabinets, etc. Roughly 80% of sales come from replacement purchases. I recently read that appliance sales only vary 1% for every 6% of housing moves. This allows for productivity to be more predictable.
Over the last year they have shed some of the fat left by the Maytag purchase. With a little bit of research you will see that they have shut down or moved a few of the plants that were aquired with the Maytag take over. They have incurred additional cost that have started to fall off and will continue to increase profit.
The second largest appliance producer in the world, GE, is currently in the process of selling off their appliance department. This will obviously have a huge impact on the number one producers in the world, Whirlpool.
While overall sales fell during the first quarter, sales in Europe, Asia, and Latin America rose by double figures.
I fully expect this stock to reach $100 by years end. I have done very well following this stock on a daily basis so far this year.
I will continue to track this stock in this post.
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