Whirlpool Forecast Energizes Stock Price

Whirlpool stock is surging Monday morning as the company boosts its full-year earnings forecast following a pleasing first-quarter announcement.
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NEW YORK (TheStreet) -- Whirlpool (WHR) - Get Report stock has surged 13.7% to $116.27 as the company boosted its full-year earnings forecast following a pleasing first-quarter announcement.

Whirlpool expects earnings of between $8 and $8.50 a share for the full-year, up from its previous outlook of $6.50 to $7 a share and above the average analyst estimate of $7.08 a share. The company also expects to generate free cash flow of about $500 million to $600 million, compared with the previous outlook of between $400 million and $500 million.

"We are increasing our outlook to reflect our strong first-quarter results and our ongoing productivity initiatives," Whirlpool chief Jeff Fettig said. "While economic uncertainty remains, Whirlpool is well-positioned to substantially grow earnings from prior-year levels. Our innovation pipeline is strong and we continue to make the appropriate investments in our global brand offerings to drive growth across the company."

For the first quarter, Whirlpool's net earnings rose 141% to $164 million, or $2.13 a share, compared with $68 million, or 91 cents a share last year. Adjusted earnings were $ 2.51 a share, versus the consensus estimate of $1.33 a share.

The company posted sales of $4.3 billion, up 20%, beating the average view of $3.79 billion. Whirlpool North America saw first-quarter sales of $2.3 billion, up 7% from the prior year, as consumers began to loosen their purse strings again. Sales also increased at Whirlpool Europe, Whirlpool Latin America, and Whirlpool Asia, up 6%, 65% and 60% respectively.

"Buoyed by a recovery in the U.S. for replacement appliance purchases (tax rebate programs, improved consumer psyche) and for appliances to outfit newly built homes, Whirlpool blew past consensus earnings expectations," Wall Street Strategies analyst Brian Sozzi wrote in an investor note. "However, it would be misleading to characterize the three-month period as one benefiting solely from easy year earlier U.S. sales comparisons."

Whirlpool, Sozzi noted, continued to squeeze out productivity from its already lean operating model; for example, by utilizing common parts during the production process and strengthening its footprint in the more robust international markets of Brazil and Asia.

-- Reported by Andrea Tse in New York

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