Schaeffer's Top Stock Picks for '25

What You Need to Know About Whirlpool Stock Ahead of Earnings

Reviewing the pros and cons of buying WHR

Jan 25, 2022 at 10:05 AM
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Whirlpool Corporation (NYSE:WHR) is gearing up to release its fiscal fourth-quarter earnings report after the close on Wednesday, Jan. 26. WHR will also hold a conference call to discuss Q4 performance, and Wall Street analysts anticipate that the home appliance company will report earnings of $5.84 per share in the upcoming  report.

The security is sinking ahead of tomorrow's confessional, last seen down 1.8% at $203.52. WHR yesterday hit a nine month low of $196.39 before shooting back up the chart to log a daily win after finding its footing at familiar support near the $196.50 level. The stock is testing support at its year-to-date breakeven level today, though it's suffered a year-to-date drop of nearly 14%. It's worth noting, however, WHR is nearing "oversold" territory, with a 14-day Relative Strength Index (RSI) of 36, which could be indicative of a short-term bounce. 

whr jan 25

The dip has short-term options players picking up puts at a much quicker-than-usual clip. This is per WHR's Schaeffer's put/call volume ratio (SOIR) of 1.79, which stands higher than all but 2% of readings from the past 12 months. This is echoed by Whirlpool stock's 10-day put/call volume ratio of 2.14 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands in the 83rd percentile of its annual range. 

Short sellers have been piling on, too. Short interest rose 12.7% in the last two reporting periods, and now makes up 11.3% of the stock's available float, or over 11 days' worth of pent-up buying power at the stock's average daily pace of trading. 

From a fundamental point of view, the home appliance company has lacked consistency on its top- and bottom-line growth in recent years. WHR reported two consecutive years of annual revenue declines in fiscal 2019 and fiscal 2020, decreasing 8% in total. Whirlpool also experienced a 9% drop in net income for fiscal 2020.

Despite all this, Whirlpool stock has a very attractive valuation, trading at a price-earnings ratio of 6.41 and a price-sales ratio of 0.58. Whirlpool stock also offers a forward dividend of $5.60 with a dividend yield of 2.78%. In addition, WHR has paid dividends consistently since 1989 and has increased its dividend on an annual basis since 2013, making the stock an intriguing long-term play for investors searching for consistent returns.

 
 

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