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Whirlpool (WHR) Lags Q4 Earnings Estimate, Guides FY17

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Whirlpool Corp. (WHR - Free Report) , the largest home-appliances manufacturer in the world, released its fourth-quarter 2016 results, wherein earnings from ongoing business of $4.33 per share jumped 5.6% from $4.10 a share earned in the year-ago quarter. However, the bottom-line came much below the Zacks Consensus Estimate of $4.42.

For fiscal 2017, the company expects GAAP earnings in the range of $13.25–$14.25 per share. Earnings from ongoing business is envisioned in a band of $15.25–$16.25 per share.

Earnings Estimate Revision: The Zacks Consensus Estimate for 2016 has been stable in the last 30 days. However, if we look at Whirlpool’s performance in the trailing four quarters (including the quarter under review), the company has an average negative surprise of 1.5%.

Revenues: Whirlpool’s net sales rose 1.7% to $5,656 million, also surpassing the Zacks Consensus Estimate of $5,582 million. On a currency-neutral basis, sales witnessed a growth of more than 2%.

Key Events: Whirlpool put forward a proposal seeking the reorganization of its dryer manufacturing operations in the Europe, Middle East and Africa (EMEA) region, as a reaction to Britain’s vote to exit the European Union (“Brexit”) on Jun 23, 2016. The company revealed that its Yate facility in U.K., will now manufacture dryers exclusively for its U.K. customers as part of changes at the unit. Further, Whirlpool intends to cease production at its facility in Amiens, France in 2018 and focus on producing dryers for its non-U.K. customers in Lodz, Poland.

Whirlpool expects these actions, which will be eventually completed in 2018, to affect about 500 employees. Further, these initiatives are expected to attract costs of about $88 million, including $65 million of employee-related costs, $12 million asset impairment charges and $11 million of other costs.

Zacks Rank: Currently, Whirlpool carries a Zacks Rank #2 (Buy) which is subject to change following the just released earnings results. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stock Movement: Whirlpool’s shares fell about 1.1% during pre-market trading hours following the lower than expected results.

Check back later for our full write up on Whirlpool’s earnings report!

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