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Whirlpool Partners with Innit to Bring Advancement in Cooking

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Price movement of Whirlpool

Whirlpool (WHR) has a market cap of $13.4 billion. It fell by 1.1% to close at $174.43 per share on June 16, 2016. The stock’s weekly, monthly, and YTD (year-to-date) price movements were -2.9%, 3.4%, and 20.2%, respectively, on the same day. WHR is trading 0.22% above its 20-day moving average, 1.4% below its 50-day moving average, and 10.2% above its 200-day moving average.

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Related ETFs and peers

The Vanguard Mid-Cap ETF (VO) invests 0.42% of its holdings in Whirlpool. The ETF tracks the CRSP US Mid Cap Index, a diversified index of US mid-cap companies. The YTD price movement of VO was 2.1% on June 16, 2016.

The SPDR S&P 500 ETF (SPY) invests 0.08% of its holdings in Whirlpool. The ETF tracks a market cap–weighted index of US large- and mid-cap stocks selected by the S&P Committee.

The market caps of Whirlpool’s competitors are as follows:

  • Spectrum Brands Holdings (SPB): $7.0 billion
  • Sears Holdings (SHLD): $1.5 billion

Whirlpool’s partnership with Innit

In a press release on June 16, 2016, Whirlpool stated the following: “Whirlpool Corporation, the world’s leading manufacturer of major home appliances, and Innit®, a leading food tech innovator, today announced a partnership to bring a new layer of food intelligence to help people eat and live better. Whirlpool Corporation connected cooking appliances, starting with Jenn-Air® brand WiFi connected ovens, will offer the Innit platform to enable advanced automated cooking and dynamic digital recipes to help people cook more at home.”

The company also stated, “Innit Empowered appliances and apps give consumers a way to access thousands of digitized recipes, based on personalized dietary and taste preferences.”

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Whirlpool’s performance in 1Q16

Whirlpool (WHR) reported 1Q16 net sales of $4.6 billion, a decline of 4.7% compared to net sales of $4.8 billion in 1Q15. The company’s gross margin and operating profit fell by 3.8% and 6.6%, respectively, in 1Q16 compared to 1Q15.

Whirlpool’s net income and EPS (earnings per share) fell to $150.0 million and $1.92, respectively, in 1Q16, compared to $191.0 million and $2.38, respectively, in 1Q15.

Whirlpool’s cash and cash equivalents fell by 9.5%, and its inventories rose by 18.2% in 1Q16 compared to 4Q15. Its current ratio and long-term debt-to-equity ratio fell to 0.91x and 0.93x, respectively, in 1Q16, compared to 0.95x and 0.99x, respectively, in 4Q15.

The company announced a share repurchase program of $1 billion and an 11% rise in dividends. During 1Q16, it repurchased shares worth $225 million.

Projections

Whirlpool has made the following projections for 2016:

  • EPS in the range of $11.25–$12
  • ongoing business EPS in the range of $14–$14.75
  • free cash flow in the range of $700 million–$800 million, including restructuring cash outlays of up to $200 million, legacy product warranty and liability costs of $155 million, and capital spending of $700 million–$750 million

Further, Whirlpool expects industry unit shipments to fall by 10% in Brazil but rise by 5%–6% in North America. Industry unit shipments are expected to rise 0%–2% in the EMEA (Europe, the Middle East, and Africa) region.

Now, let’s take a look at Cal-Maine Foods.

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