Why Whirlpool Corporation (NYSE:WHR) Could Be Worth Watching

Whirlpool Corporation (NYSE:WHR), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s examine Whirlpool’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for Whirlpool

What's The Opportunity In Whirlpool?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 14.86% above my intrinsic value, which means if you buy Whirlpool today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $121.02, there’s only an insignificant downside when the price falls to its real value. Although, there may be an opportunity to buy in the future. This is because Whirlpool’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What does the future of Whirlpool look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with a relatively muted revenue growth of 0.2% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Whirlpool, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in WHR’s future outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on WHR, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example, Whirlpool has 3 warning signs (and 1 which can't be ignored) we think you should know about.

If you are no longer interested in Whirlpool, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.