Whirlpool Corp. (WHR) has had a great year in spite of the challenging consumer environment, relying on cost cutting and growing international exposure to produce strong earnings.

Company Description

Whirlpool Corp. develops and manufactures home appliances worldwide. The company was founded in 1906 and has a market cap of $6.05 billion.

The weak consumer environment hasn’t stopped shares of WHR from posting big gains in 2009, fueled by the company’s better than expected Q2 results from early October.

Third-Quarter Results

Sales were off a bit from last year, down 9% to $2.5 billion, but earnings came in much better than expected at $1.65, 88 cents ahead of the Zacks Consensus Estimate. Whirlpool has handily beat in each of the last 3 quarters by more than 100%.

Whirlpool’s solid performance was driven by a strong showing in North America, where operating profit increased to $140 million from $74 million last year on cost reductions and productivity gains. The company also looked strong in Latin America, where sales were flat year over year, but would have been up 12% excluding currency translations.

CEO Talk

It’s clear that Whirlpool has acted quickly to respond to changing market conditions. CEO Jeff Fetig underscored this notion, saying “our improved outlook reflects our success in restructuring our business to aggressively align our capacity and resources to lower demand levels.”

Estimates Rising

The good quarter and optimistic outlook sent Whirlpool estimates higher. The current year added 46 cents and moved to $4.41. The next-year estimate is very bullish, pegged at $6.32, a 43% growth projection.

Valuation

Based on the next-year estimate, which kicks in at the new year, WHR has a forward P/E multiple of 13X, a discount to the overall.

The Chart

Shares of WHR have had a great year, locking into a very nice upward trend after bottoming out in early March with the overall market. A new 52-week high was hit last week just above $85, take a look below.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Surprise Trader Service.

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