Fundamental Analysis: WHIRPOOL COPORATION #WHR

Whirlpool (WHR US) is an American multinational manufacturer and marketer of home appliances, headquartered in Benton Charter Township, Michigan, United States.

The company looks very high quality in terms of fundamental indicators and is underestimated to its fair value.

We consider the stock for an "Optimal risk" portfolio at the current price


Key factors:


⚡️ Good financial results for the quarter of 2020.

Whirlpool increased revenue year-on-year during this period by 3.9% and reached $5.29 billion.

EBITDA by quarter has increased by 59.5% and reached $759 million, with Net profit increased by 63.9% to $437 million.

Earnings per share increased by 66.5% and reached $6.92.

The results showed a high level of capability of the company to work effectively during the pandemic.


⚡️ Affordable mortgages - growth in real estate - high demand for appliances for the home.

Whirlpool can be one of the largest beneficiaries of the U.S. real estate boom, which was observed for the last 3 quarters.

The reason is a record low mortgage rates, which have now fallen to lowest 3%.

Obviously, housing construction will expand further and it is logical that against this background, the demand for new appliances, as well as the replacement of old equipment will continue to grow accordingly.

This has a positive effect on the company's sales, especially considering that Whirlpool products are not premium category but more affordable.


⚡️ Whirlpool shares look undervalued in comparison to its analogues.

To date, the company's shares are traded at a substantial discount in relation to their fair value: the current price is approx. $ 189 compared to fair value of $ 223. This gives a 15% undervalue potential.


However, as usual it is important to consider the risks involved: for #WHR we believe that key risks are high competition in the sector and the real estate exposure over the long term.




OTB Global Investments

London, 4 January 2021

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