After Whirlpool gets slammed from Amazon-Sears deal, JPMorgan calls fears 'overdone'

JPMorgan analysts believe Whirlpool's (NYSE: WHR) decline in light of Sears' announcement that it will be selling its full line of Kenmore appliances on Amazon (NASDAQ: AMZN) is "overdone."

Shares of Whirlpool posted a sharp decline of 4 percent on Thursday after Sears (NASDAQ: SHLD) declared plans on Thursday to sell Kenmore-branded appliances on Amazon.com.

After the opening bell, Whirlpool traded slightly higher, up 0.12 percent.

"If Amazon eventually becomes a more significant retailer of major appliances, Whirlpool will be there," wrote JPMorgan analyst Michael Rehaut in Thursday's note. "Whirlpool has proven its ability to adapt to a changing retail landscape over the past decade."

The analysts view Whirlpool with less angst than markets, noting both Sears' and Kenmore's recent declines in market share. Sears (NASDAQ: SHLD)' share of the appliance market is roughly 20 percent, according to the report, down from 40 percent in the early 2000s.

"More specifically, Kenmore represents 40-50% of Sears' appliance sales — hence roughly 10% of the overall appliance industry — and has also been losing market share at a similar rate," added Rehaut.

Sears, which has seen its shares fall about 40 percent over the past year, saw its stock jump 10 throughout trading on Thursday. Its Kenmore-branded appliances will be compatible with Amazon's Alexa platform.

"Given Whirlpool's leading market share of roughly 40% across the industry as well as across all major retailers and distribution channels … we believe that, as the company has adapted to the changing retail landscape over the past decade, it will continue to do so going forward," said Rehaut.

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