February 4, 2023

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Whirlpool sees performance in line with expectations, according to JPMorgan By Investing.com

©Reuters. Whirlpool (WHR) performed in line with JPMorgan’s expectations

By Sam Boughedda

Whirlpool (NYSE:) was downgraded to neutral from overweight on Tuesday at JPMorgan, with a price target cut to $137 from $145 per share.

Analysts at JPMorgan told investors in a note that they expect WHR to meet expectations, supporting a neutral rating.

“While we continue to view the stock as cheap, currently trading at only about 5.2x our 2023E EBITDA, we believe investor concerns about the sustainability of North American margins will continue to impact valuation, which is reflected in the next 6-12 months against a potentially more supportive and competitive backdrop, while we finally note the Company’s increased leverage following the acquisition of InSinkerator, currently at 2.8x Net Debt/2022E EBITDA versus our overall average of 1.9x.” , the analysts said.

They also said the re-rating reflects the company’s outlook on recent investor concerns and headwinds, including the sustainability of demand and the company’s recently elevated earnings, exposure of several companies to Europe, ongoing cost inflation, and the backdrop of higher interest rates and a possible slowdown in the US macro economy.

“As our newly adjusted price target of $137 for December 2023, now based on an approximately 5.5x target EV/EBITDA multiple over our 2024E EBITDA, represents return potential in line with our universe average, we expect WHR to perform in line with its peers, which in turn supports our neutral rating,” the analysts concluded.