Investors in Whirlpool Corporation (NYSE:WHR) had a good week, as its shares rose 5.1% to close at US$154 following the release of its full-year results. The result was positive overall - although revenues of US$20b were in line with what analysts predicted, Whirlpool surprised by delivering a statutory profit of US$18.45 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Following last week's earnings report, Whirlpool's eight analysts are forecasting 2020 revenues to be US$20.1b, approximately in line with the last 12 months. Statutory earnings per share are expected to descend 15% to US$15.86 in the same period. Yet prior to the latest earnings, analysts had been forecasting revenues of US$20.3b and earnings per share (EPS) of US$16.02 in 2020. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
Analysts reconfirmed their price target of US$161, showing that the business is executing well and in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Whirlpool analyst has a price target of US$186 per share, while the most pessimistic values it at US$136. This shows there is still quite a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
Further, we can compare these estimates to past performance, and see how Whirlpool forecasts compare to the wider market's forecast performance. We would highlight that sales are expected to reverse, with the forecast 1.5% revenue decline a notable change from historical growth of 0.4% over the last five years. Compare this with our data, which suggests that other companies in the same market are, in aggregate, expected to see their revenue grow 5.3% next year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - analysts also expect Whirlpool to grow slower than the wider market.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Whirlpool's revenues are expected to perform worse than the wider market. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Whirlpool analysts - going out to 2024, and you can see them free on our platform here.
It might also be worth considering whether Whirlpool's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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