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WHR Stock Trades Above 50 & 200-Day SMA: What Should You Do Next?
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Whirlpool Corporation (WHR - Free Report) is experiencing an impressive upward trend, trading above its 50-day and 200-day simple moving averages (SMA). As of Monday, WHR was trading at $124.45, surpassing its 50-day SMA of $106.82 and 200-day SMA of $99.28, highlighting a continued uptrend. This highlights its stability and suggests a strong long-term bullish trend, positioning WHR as a key stock to monitor in the Consumer Discretionary space.
WHR Trades Above 50- and 200-Day Moving Averages
Image Source: Zacks Investment Research
The SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. This approach provides a clearer perspective on a stock's long-term direction. This technical strength, coupled with WHR stock's sustained momentum, indicates positive market sentiment and reflects investor confidence in its financial health and growth potential.
Shares of Whirlpool, a leading player in the Household Appliances sector, surged 27.2% in the past month, significantly outperforming the broader industry’s growth of 10.8%. In comparison, the Zacks Consumer Discretionary sector registered growth of 4.5%, whereas the S&P 500 registered a modest 1% increase in the same period.
WHR Stock Price Performance
Image Source: Zacks Investment Research
This upswing in Whirlpool's stock was driven by investor optimism following the company’s reaffirmation of its full-year expectations. The strong performance in the third quarter further boosted market confidence, contributing to the stock's notable rise.
Decoding WHR’s Growth Story
Whirlpool's growth story is largely driven by significant strides in protecting margins and maintaining productivity through its cost-takeout initiatives, particularly in response to inflationary pressures. The company has completed its organizational simplification as part of its cost-takeout plan, aiding in the reduction of structural and discretionary costs, management of working capital and alignment of supply chain and labor levels with demand.
Despite a challenging macroeconomic environment, Whirlpool achieved $150 million in cost takeout during the first half of 2024. The company remains on track to reach $300 million in cost-takeout by the end of 2024, supported by continued manufacturing and supply chain efficiencies. Looking forward, Whirlpool is optimistic about uncovering additional cost opportunities through automation, input cost optimization and supply chain advancements aimed at restoring costs to pre-pandemic levels.
A central component of Whirlpool's strategy is product innovation and margin expansion. In MDA North America, Whirlpool launched two new products in its laundry category, including an advanced front-load laundry pair with the Fresh Flow Vent System and the innovative Pet Pro Filter in front-load washers. Additionally, KitchenAid introduced its first four-door refrigerator. These innovations highlight Whirlpool’s commitment to driving growth through new, differentiated products.
Whirlpool's strategic pricing actions have resulted in sequential EBIT margin expansion, particularly in North America. It observed that promotional investments in the United States were not driving the expected volume increases, as strong replacement demand led to a lower product mix, diminishing promotion effectiveness. To address this, the company implemented a 5% weighted average increase in its promotional pricing program for MDA North America, effective April 25, 2024.
Whirlpool Stock’s Roadblocks
While Whirlpool demonstrated strong margin expansion and innovation-driven growth, its performance faced challenges from persistent global demand softness and unfavorable price/mix. In the third quarter of 2024, North American sales declined 4.3% due to these factors, while SDA Global sales dipped 3% amid weak consumer sentiment.
Management expects a tough macro backdrop in the United States, at least in the near term. Despite the recent interest rate cut, the U.S. housing market is witnessing higher mortgage rates. Consequently, demand in the United States has shifted heavily toward low-margin replacement, led by purchases, and the high-margin discretionary demand remains weak on sluggish home sales. However, the housing market is poised for an eventual rebound.
WHR Stock: A Strategic Guide for Investors
Whirlpool has performed well, driven by its reaffirmation of full-year guidance, successful cost-takeout initiatives and product innovation. These factors have contributed to margin expansion, particularly in North America, and bolstered investor confidence, leading to strong stock performance. However, the company faces near-term challenges, including global demand softness, unfavorable price/mix dynamics and macroeconomic pressures in the U.S. housing market.
Potential shareholders should wait for a more favorable entry point. Meanwhile, current stakeholders might consider holding the stock, as its strong fundamentals point to robust long-term prospects. The stock currently carries a Zacks Rank #3 (Hold).
Wolverine World Wide designs, manufactures and distributes a wide variety of casual and active apparel and footwear. The company sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for WWW’s current financial-year sales indicates a decline of almost 23% from the year-ago figure. The consensus mark for EPS indicates significant growth to 89 cents from 5 cents reported in the prior year. WWW has a trailing four-quarter earnings surprise of 17.03%, on average.
Gildan Activewear manufactures and sells various apparel products in the United States, North America, Europe, the Asia Pacific and Latin America. It carries a Zacks Rank of 2 (Buy) at present. GIL has a trailing four-quarter earnings surprise of 5.4%, on average.
The consensus estimate for Gildan Activewear’s current financial-year sales and earnings indicates advancements of 1.5% and 15.6%, respectively, from the prior-year figures.
Snap-on, a global provider of professional tools, equipment and related solutions for technicians, vehicle service centers, original equipment manufacturers and other industrial users, currently carries a Zacks Rank #2. SNA has a trailing four-quarter earnings surprise of 1.6%, on average.
The Zacks Consensus Estimate for Snap-on’s current financial year’s earnings indicates growth of 3% from the year-ago period's reported numbers.
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WHR Stock Trades Above 50 & 200-Day SMA: What Should You Do Next?
Whirlpool Corporation (WHR - Free Report) is experiencing an impressive upward trend, trading above its 50-day and 200-day simple moving averages (SMA). As of Monday, WHR was trading at $124.45, surpassing its 50-day SMA of $106.82 and 200-day SMA of $99.28, highlighting a continued uptrend. This highlights its stability and suggests a strong long-term bullish trend, positioning WHR as a key stock to monitor in the Consumer Discretionary space.
WHR Trades Above 50- and 200-Day Moving Averages
Image Source: Zacks Investment Research
The SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. This approach provides a clearer perspective on a stock's long-term direction. This technical strength, coupled with WHR stock's sustained momentum, indicates positive market sentiment and reflects investor confidence in its financial health and growth potential.
Shares of Whirlpool, a leading player in the Household Appliances sector, surged 27.2% in the past month, significantly outperforming the broader industry’s growth of 10.8%. In comparison, the Zacks Consumer Discretionary sector registered growth of 4.5%, whereas the S&P 500 registered a modest 1% increase in the same period.
WHR Stock Price Performance
Image Source: Zacks Investment Research
This upswing in Whirlpool's stock was driven by investor optimism following the company’s reaffirmation of its full-year expectations. The strong performance in the third quarter further boosted market confidence, contributing to the stock's notable rise.
Decoding WHR’s Growth Story
Whirlpool's growth story is largely driven by significant strides in protecting margins and maintaining productivity through its cost-takeout initiatives, particularly in response to inflationary pressures. The company has completed its organizational simplification as part of its cost-takeout plan, aiding in the reduction of structural and discretionary costs, management of working capital and alignment of supply chain and labor levels with demand.
Despite a challenging macroeconomic environment, Whirlpool achieved $150 million in cost takeout during the first half of 2024. The company remains on track to reach $300 million in cost-takeout by the end of 2024, supported by continued manufacturing and supply chain efficiencies. Looking forward, Whirlpool is optimistic about uncovering additional cost opportunities through automation, input cost optimization and supply chain advancements aimed at restoring costs to pre-pandemic levels.
A central component of Whirlpool's strategy is product innovation and margin expansion. In MDA North America, Whirlpool launched two new products in its laundry category, including an advanced front-load laundry pair with the Fresh Flow Vent System and the innovative Pet Pro Filter in front-load washers. Additionally, KitchenAid introduced its first four-door refrigerator. These innovations highlight Whirlpool’s commitment to driving growth through new, differentiated products.
Whirlpool's strategic pricing actions have resulted in sequential EBIT margin expansion, particularly in North America. It observed that promotional investments in the United States were not driving the expected volume increases, as strong replacement demand led to a lower product mix, diminishing promotion effectiveness. To address this, the company implemented a 5% weighted average increase in its promotional pricing program for MDA North America, effective April 25, 2024.
Whirlpool Stock’s Roadblocks
While Whirlpool demonstrated strong margin expansion and innovation-driven growth, its performance faced challenges from persistent global demand softness and unfavorable price/mix. In the third quarter of 2024, North American sales declined 4.3% due to these factors, while SDA Global sales dipped 3% amid weak consumer sentiment.
Management expects a tough macro backdrop in the United States, at least in the near term. Despite the recent interest rate cut, the U.S. housing market is witnessing higher mortgage rates. Consequently, demand in the United States has shifted heavily toward low-margin replacement, led by purchases, and the high-margin discretionary demand remains weak on sluggish home sales. However, the housing market is poised for an eventual rebound.
WHR Stock: A Strategic Guide for Investors
Whirlpool has performed well, driven by its reaffirmation of full-year guidance, successful cost-takeout initiatives and product innovation. These factors have contributed to margin expansion, particularly in North America, and bolstered investor confidence, leading to strong stock performance. However, the company faces near-term challenges, including global demand softness, unfavorable price/mix dynamics and macroeconomic pressures in the U.S. housing market.
Potential shareholders should wait for a more favorable entry point. Meanwhile, current stakeholders might consider holding the stock, as its strong fundamentals point to robust long-term prospects. The stock currently carries a Zacks Rank #3 (Hold).
Key Picks
Some better-ranked stocks are Wolverine World Wide (WWW - Free Report) , Gildan Activewear Inc. (GIL - Free Report) and Snap-on Incorporated (SNA - Free Report) .
Wolverine World Wide designs, manufactures and distributes a wide variety of casual and active apparel and footwear. The company sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for WWW’s current financial-year sales indicates a decline of almost 23% from the year-ago figure. The consensus mark for EPS indicates significant growth to 89 cents from 5 cents reported in the prior year. WWW has a trailing four-quarter earnings surprise of 17.03%, on average.
Gildan Activewear manufactures and sells various apparel products in the United States, North America, Europe, the Asia Pacific and Latin America. It carries a Zacks Rank of 2 (Buy) at present. GIL has a trailing four-quarter earnings surprise of 5.4%, on average.
The consensus estimate for Gildan Activewear’s current financial-year sales and earnings indicates advancements of 1.5% and 15.6%, respectively, from the prior-year figures.
Snap-on, a global provider of professional tools, equipment and related solutions for technicians, vehicle service centers, original equipment manufacturers and other industrial users, currently carries a Zacks Rank #2. SNA has a trailing four-quarter earnings surprise of 1.6%, on average.
The Zacks Consensus Estimate for Snap-on’s current financial year’s earnings indicates growth of 3% from the year-ago period's reported numbers.