Latest news with #MarcBitzer
Yahoo
08-05-2025
- Business
- Yahoo
Meet the 9.1%-Yielding Dividend Stock That's a Potential Winner From President Trump's Tariffs
Whirlpool's massive dividend may not prove sustainable. There's good reason to believe that Whirlpool will be a net winner from President Donald Trump's tariff approach. The stock will become more interesting if and when management cuts its dividend. 10 stocks we like better than Whirlpool › During Whirlpool's (NYSE: WHR) first-quarter earnings call in late April, CEO Marc Bitzer said he believes his company will be a "net winner of a new tariff policy." He has a strong case for thinking so, and it looks likely the appliance maker has real potential to see better days ahead. That said, is the stock worth buying now? And how sustainable is its dividend, which at the current share price yields a hefty 9.2%? Matters could get worse for Whirlpool before they get better. Starting with the near-term headwinds, there are two related things to consider. The demand destruction coming from the economic uncertainty created by President Donald Trump's trade war and its impact on interest rates and the housing market. Trump's election win induced Whirlpool's Asian competitors to act aggressively and push more appliances into the U.S. market in 2024's fourth quarter and 2025's first quarter, creating a challenging competitive environment. The first point is significant because even if a new tariff environment favors Whirlpool's competitive positioning versus its peers, the company may still have to deal with weak overall demand. Unfortunately, market interest rates on U.S. Treasuries haven't come down enough to reduce mortgage rates, and existing home sales (one of the best gauges for the state of the housing market) remain relatively low. This not only pressures overall sales -- Whirlpool's major domestic appliance sales in North America declined by 0.1% year over year (excluding currency impacts) in the first quarter -- but it also means that a smaller share of those sales will come from the higher-margin discretionary segment, such as fitted kitchens and bathrooms. Turning to the second issue, Bitzer addressed it on the earnings call: "Imports from Asian producers, again, not just China, all Asian producers ... was up 30% in January, February also reached the same level, up 30%." He went on to say there's "a fairly sizable amount of inventory in the country." He expected "similar market dynamics" in the second quarter. The bottom line is that Trump's imposition of tariffs has created a challenging end-demand environment for Whirlpool, and the expectation that they were coming prompted its Asian competitors to preload the market, meaning that Whirlpool faces a difficult first half of 2025 in its core U.S. market. In the long term, Whirlpool's outlook should get a lot better for two key reasons. First, about 80% of what Whirlpool sells in the U.S. is produced in the U.S. By contrast, only about 25% of the rest of the industry's production is domestic, Bitzer said on the earnings call. In addition, only 5% of what Whirlpool sells in the U.S. is sourced in China. This gives the company a key edge in tariffs imposed on imports to the U.S. Second, Whirlpool's management believes the Trump administration will close a loophole under Section 232 that has allowed Asian producers to avoid paying tariffs on Chinese steel (which is notably cheaper than U.S. steel) used in their appliances (Whirlpool uses U.S. steel in domestic products) and also in steel used in components (LED panels, motors) that Whirlpool imports. The end result -- between the cost differential and the lower tariffs -- is a $70 per product advantage for Asian producers, which translates into a $150 difference in the retail price. If Bitzer's confidence in the Trump administration closing the loophole is well-founded, then that gap will close. Moreover, if that leads to a pick-up in sales volume for Whirlpool, the company has the spare capacity in its U.S. factories to ramp up production, which should lead to margin expansions due to scale. While there is still a lot of uncertainty about which tariffs will stay and at what levels, the deals being negotiated to end the tariffs could eventually result in a more level playing field for U.S.-based manufacturers like Whirlpool. That said, the near-term environment is challenging, as is the company's balance sheet: It has $4.8 billion in long-term debt and $1.85 billion in debt maturing this year. Management expects Whirlpool will generate $500 million to $600 million in free cash flow this year, which will help it repay $700 million worth of debt and refinance $1.1 billion to $1.2 billion. However, these plans could come unstuck if it misses its estimates, and given the near-term challenges, that could happen. Reducing its $380 million annual dividend payout would help in that scenario and refocus investor attention on Whirlpool's long-term opportunity to regain market share from Asian competitors. All told, Whirlpool is not a stock to buy for its dividend, but if and when management decides to cut it, it could become extremely interesting as a stock. Before you buy stock in Whirlpool, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Whirlpool wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $611,589!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $697,613!* Now, it's worth noting Stock Advisor's total average return is 894% — a market-crushing outperformance compared to 163% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 5, 2025 Lee Samaha has no position in any of the stocks mentioned. The Motley Fool recommends Whirlpool. The Motley Fool has a disclosure policy. Meet the 9.1%-Yielding Dividend Stock That's a Potential Winner From President Trump's Tariffs was originally published by The Motley Fool
Globe and Mail
05-05-2025
- Business
- Globe and Mail
Better Dividend Stock: Whirlpool vs. UPS
The 6.8% dividend yield of UPS (NYSE: UPS) stock and the 9.1% dividend yield of Whirlpool (NYSE: WHR) stock are obviously attractive for passive income-seeking investors. However, there's no such thing as a free lunch, and their yields reflect some doubt in the marketplace around the sustainability of their dividends. That said, which stock is better, and what risks do you need to know about before buying the stock? Whirlpool stock analysis (9.1% dividend yield) Both Whirlpool's and UPS' shares are down heavily this year, as they've both suffered a deterioration in their trading conditions. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » WHR data by YCharts. For Whirlpool, it comes down to a combination of stubbornly high interest rates and competitor behavior in light of President Donald Trump's reelection. Relatively high interest rates curtail the housing market and, in turn, discretionary demand (which tends to be higher-margin than replacement demand) for housing appliances. Consequently, Whirlpool's first-quarter organic sales rose just 2.2% year over year, with organic sales flat in its key major domestic appliance North America business. Whirlpool's sales were also highly likely affected by competitor behavior in the fourth quarter of 2024 and the first quarter of 2025. CEO Marc Bitzer said on the recent earnings call: "Asian appliance producers significantly increased imports into the U.S. ahead of the tariffs in the first quarter and fourth quarter, essentially loading the U.S. industry. This market disruption will likely continue into Q2 as competitors attempt to sell through their inventory." With the first and second quarters negatively affected by such actions, 30-year mortgage rates still above 6.5%, and general uncertainty in the economy concerning tariffs, this casts some doubt on management's decision to maintain its full-year guidance. Whirlpool's full-year guidance implies that its dividend is sustainable. For example, the guidance calls for sales of $15.8 billion with an ongoing earnings before interest and tax (EBIT) margin of 6.8%, implying an ongoing EBIT of $1.07 billion, dropping down to $500 million to $600 million in free cash flow (FCF). That's more than enough to cover the the $384 million in dividends that Whirlpool paid last year. That said, there's a significant risk to the dividend if Whirlpool falters this year. The company has $4.8 billion in long-term debt and $1.85 billion in debt maturing this year, of which it plans to pay down $700 million and refinance $1.1 billion to $1.2 billion. Any significant deterioration in the FCF outlook may cause management to cut the dividend to shore up its balance sheet, not least in paying down debt. UPS stock analysis (6.8% dividend yield) Continuing the theme of looking at dividend sustainability, UPS management is clear on three things regarding the matter: Its longstanding aim is to pay out 50% of its earnings in dividends, and it's committed to sustaining and growing the dividend The current dividend of $6.56 per share is barely covered by the Wall Street analyst consensus for UPS earnings in 2025 of $7.11, implying a payout ratio of 92% Management expects $5.7 billion in FCF in 2025, barely covering the $5.5 billion cash dividend Whether you look at the payout ratio in terms of earnings (as management does) or FCF, UPS' ability to pay its dividend is beginning to look stretched. At the same time, UPS management is trying to finesse a 50% reduction in delivery volume by the second half of 2026, while dealing with a deteriorating demand environment. This could cloud UPS' ability to generate earnings and cash flow over the near term. In its key U.S. domestic market, the decline in its average daily volume (ADV) in February and March was "higher than we expected," according to CEO Carol Tome on the earnings call. Moreover, UPS guidance for the second quarter calls for a U.S. domestic year-over-year ADV decline of 9%. Management declined to update its full-year guidance. UPS or Whirlpool? On balance, UPS' dividend looks more sustainable than Whirlpool's, so it wins the contest. UPS has $19.5 billion in long-term debt, which looks manageable compared to guidance for $5.7 billion in FCF in 2025. Whirlpool's $4.8 billion in long-term debt is far higher than its estimated FCF of $500 million to $600 million in 2025. However, there's a good chance both could cut their dividends by the end of the year. That doesn't mean they are unattractive stocks; it just means anyone buying in for the dividend alone needs to prepare for potential disappointment. Should you invest $1,000 in United Parcel Service right now? Before you buy stock in United Parcel Service, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and United Parcel Service wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $623,685!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $701,781!* Now, it's worth noting Stock Advisor 's total average return is906% — a market-crushing outperformance compared to164%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of April 28, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool recommends United Parcel Service and Whirlpool. The Motley Fool has a disclosure policy.
Yahoo
05-05-2025
- Business
- Yahoo
Better Dividend Stock: Whirlpool vs. UPS
The sustainability of both stocks' dividends is in question. Whirlpool has significant debt and near-term headwinds to overcome. UPS also faces near-term headwinds, and that will pressure its dividend cover. The 6.8% dividend yield of UPS (NYSE: UPS) stock and the 9.1% dividend yield of Whirlpool (NYSE: WHR) stock are obviously attractive for passive income-seeking investors. However, there's no such thing as a free lunch, and their yields reflect some doubt in the marketplace around the sustainability of their dividends. That said, which stock is better, and what risks do you need to know about before buying the stock? Both Whirlpool's and UPS' shares are down heavily this year, as they've both suffered a deterioration in their trading conditions. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » For Whirlpool, it comes down to a combination of stubbornly high interest rates and competitor behavior in light of President Donald Trump's reelection. Relatively high interest rates curtail the housing market and, in turn, discretionary demand (which tends to be higher-margin than replacement demand) for housing appliances. Consequently, Whirlpool's first-quarter organic sales rose just 2.2% year over year, with organic sales flat in its key major domestic appliance North America business. Whirlpool's sales were also highly likely affected by competitor behavior in the fourth quarter of 2024 and the first quarter of 2025. CEO Marc Bitzer said on the recent earnings call: "Asian appliance producers significantly increased imports into the U.S. ahead of the tariffs in the first quarter and fourth quarter, essentially loading the U.S. industry. This market disruption will likely continue into Q2 as competitors attempt to sell through their inventory." With the first and second quarters negatively affected by such actions, 30-year mortgage rates still above 6.5%, and general uncertainty in the economy concerning tariffs, this casts some doubt on management's decision to maintain its full-year guidance. Whirlpool's full-year guidance implies that its dividend is sustainable. For example, the guidance calls for sales of $15.8 billion with an ongoing earnings before interest and tax (EBIT) margin of 6.8%, implying an ongoing EBIT of $1.07 billion, dropping down to $500 million to $600 million in free cash flow (FCF). That's more than enough to cover the the $384 million in dividends that Whirlpool paid last year. That said, there's a significant risk to the dividend if Whirlpool falters this year. The company has $4.8 billion in long-term debt and $1.85 billion in debt maturing this year, of which it plans to pay down $700 million and refinance $1.1 billion to $1.2 billion. Any significant deterioration in the FCF outlook may cause management to cut the dividend to shore up its balance sheet, not least in paying down debt. Continuing the theme of looking at dividend sustainability, UPS management is clear on three things regarding the matter: Its longstanding aim is to pay out 50% of its earnings in dividends, and it's committed to sustaining and growing the dividend The current dividend of $6.56 per share is barely covered by the Wall Street analyst consensus for UPS earnings in 2025 of $7.11, implying a payout ratio of 92% Management expects $5.7 billion in FCF in 2025, barely covering the $5.5 billion cash dividend Whether you look at the payout ratio in terms of earnings (as management does) or FCF, UPS' ability to pay its dividend is beginning to look stretched. At the same time, UPS management is trying to finesse a 50% reduction in delivery volume by the second half of 2026, while dealing with a deteriorating demand environment. This could cloud UPS' ability to generate earnings and cash flow over the near term. In its key U.S. domestic market, the decline in its average daily volume (ADV) in February and March was "higher than we expected," according to CEO Carol Tome on the earnings call. Moreover, UPS guidance for the second quarter calls for a U.S. domestic year-over-year ADV decline of 9%. Management declined to update its full-year guidance. On balance, UPS' dividend looks more sustainable than Whirlpool's, so it wins the contest. UPS has $19.5 billion in long-term debt, which looks manageable compared to guidance for $5.7 billion in FCF in 2025. Whirlpool's $4.8 billion in long-term debt is far higher than its estimated FCF of $500 million to $600 million in 2025. However, there's a good chance both could cut their dividends by the end of the year. That doesn't mean they are unattractive stocks; it just means anyone buying in for the dividend alone needs to prepare for potential disappointment. Before you buy stock in United Parcel Service, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and United Parcel Service wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $623,685!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $701,781!* Now, it's worth noting Stock Advisor's total average return is 906% — a market-crushing outperformance compared to 164% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 28, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool recommends United Parcel Service and Whirlpool. The Motley Fool has a disclosure policy. Better Dividend Stock: Whirlpool vs. UPS was originally published by The Motley Fool
Yahoo
29-03-2025
- Business
- Yahoo
Q4 Earnings Outperformers: Whirlpool (NYSE:WHR) And The Rest Of The Electrical Systems Stocks
As the craze of earnings season draws to a close, here's a look back at some of the most exciting (and some less so) results from Q4. Today, we are looking at electrical systems stocks, starting with Whirlpool (NYSE:WHR). Like many equipment and component manufacturers, electrical systems companies are buoyed by secular trends such as connectivity and industrial automation. More specific pockets of strong demand include Internet of Things (IoT) connectivity and the 5G telecom upgrade cycle, which can benefit companies whose cables and conduits fit those needs. But like the broader industrials sector, these companies are also at the whim of economic cycles. Interest rates, for example, can greatly impact projects that drive demand for these products. The 13 electrical systems stocks we track reported a slower Q4. As a group, revenues beat analysts' consensus estimates by 0.6% while next quarter's revenue guidance was 6.1% below. Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 14.4% since the latest earnings results. Credited with introducing the first automatic washing machine, Whirlpool (NYSE:WHR) is a manufacturer of a variety of home appliances. Whirlpool reported revenues of $4.14 billion, down 18.7% year on year. This print fell short of analysts' expectations by 1.5%. Overall, it was a disappointing quarter for the company with full-year EPS guidance missing analysts' expectations. "In 2024, we continued to make progress in our operations and delivered on our cost take out commitment of $300 million while achieving the closure of the Europe transaction, supporting our ongoing portfolio transformation," said Marc Bitzer. Whirlpool delivered the slowest revenue growth of the whole group. The stock is down 27.7% since reporting and currently trades at $93.53. Read our full report on Whirlpool here, it's free. Enhancing commercial environments, LSI (NASDAQ:LYTS) provides lighting and display solutions for businesses and retailers. LSI reported revenues of $147.7 million, up 35.5% year on year, outperforming analysts' expectations by 14.3%. The business had an incredible quarter with an impressive beat of analysts' EPS estimates and a solid beat of analysts' EBITDA estimates. LSI scored the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 11.2% since reporting. It currently trades at $17.58. Is now the time to buy LSI? Access our full analysis of the earnings results here, it's free. Founded in 1946, Methode Electronics (NYSE:MEI) is a global supplier of custom-engineered solutions for Original Equipment Manufacturers (OEMs). Methode Electronics reported revenues of $239.9 million, down 7.6% year on year, falling short of analysts' expectations by 8.9%. It was a disappointing quarter as it posted revenue guidance for next quarter missing analysts' expectations. Methode Electronics delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 31.3% since the results and currently trades at $6.75. Read our full analysis of Methode Electronics's results here. One of the pioneers of smart lights, Acuity (NYSE:AYI) designs and manufactures light fixtures and building management systems used in various industries. Acuity Brands reported revenues of $951.6 million, up 1.8% year on year. This result lagged analysts' expectations by 0.6%. Aside from that, it was a mixed quarter as it also recorded a decent beat of analysts' adjusted operating income estimates but a slight miss of analysts' organic revenue estimates. The stock is down 10.9% since reporting and currently trades at $271.28. Read our full, actionable report on Acuity Brands here, it's free. Founded in 1980, Sanmina (NASDAQ:SANM) is an electronics manufacturing services company offering end-to-end solutions for various industries. Sanmina reported revenues of $2.01 billion, up 7% year on year. This number beat analysts' expectations by 1.5%. More broadly, it was a mixed quarter as it also logged a decent beat of analysts' EPS estimates. The stock is flat since reporting and currently trades at $78.92. Read our full, actionable report on Sanmina here, it's free. Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Join Paid Stock Investor Research Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here. Sign in to access your portfolio
Associated Press
10-02-2025
- Business
- Associated Press
Whirlpool Corporation Earns Place on Fortune's Most Admired Companies List for Fifteenth Consecutive Year
For the fifteenth year in a row, Whirlpool Corporation has been named one of the 'World's Most Admired Companies' by Fortune. Whirlpool Corp. was once again selected for this honor due to the company's performance, management, products, and commitment to the communities around the world where the company does business. 'It is an honor to be recognized by Fortune as one of the most admired companies. This recognition is the result of incredible employees around the world and their tireless commitment to improving life at home for consumers.' 'It is an honor to be recognized by Fortune as one of the most admired companies,' said Marc Bitzer, chairman and CEO of Whirlpool Corporation. 'This recognition is the result of incredible employees around the world and their tireless commitment to improving life at home for consumers.' The World's Most Admired Companies list highlights organizations most respected by their peers, with executives emphasizing financial stability, innovation and leadership. Fortune collaborated with Korn Ferry on this survey - the two organizations analyzed 650 companies and surveyed more than 3,300 executives to measure reputation based on nine different attributes, including each firm's effectiveness in conducting business globally, its ability to attract, develop, and keep talent, its value as a long-term investment, its innovativeness, its use of corporate assets, and its responsibility to the community and environment. Click here to see the full list of 'World's Most Admired Companies.' About Whirlpool Corporation Whirlpool Corporation (NYSE: WHR) is a leading home appliance company, in constant pursuit of improving life at home. As the last-remaining major U.S.-based manufacturer of kitchen and laundry appliances, the company is driving meaningful innovation to meet the evolving needs of consumers through its iconic brand portfolio, including Whirlpool, KitchenAid, JennAir, Maytag, Amana, Brastemp, Consul, and InSinkErator. In 2024, the company reported approximately $17 billion in annual sales - close to 90% of which were in the Americas - 44,000 employees, and 40 manufacturing and technology research centers. Additional information about the company can be found at
