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Whirlpool Slips as RBC Rates it Underperform, Cuts Target

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By Dhirendra Tripathi

Investing.com – Whirlpool stock (NYSE:WHR) fell 1.6% Monday as RBC downgraded it to underperform believing the peak in profit per share of the home appliance-maker might be behind.

The new peg of $190 is 9.5% lower from the stock’s current level of $210.

The stock earlier had a sector perform rating from the brokerage with a target of $208.

Whirlpool Friday cut its annual sales guidance after third-quarter revenue fell behind expectations.

The maker of refrigerators and electric chimneys blamed supply chain issues for its shortfall, semiconductors particularly, according to Bloomberg, which quoted Whirlpool Chief Financial Officer Jim Peters.

The company now expects its full-year net sales to grow by around 13%, a figure it had marked for itself in April when times were better and it felt its initial aim of around 6% growth was not ambitious enough. As demand boomed in July, Whirlpool said 16% growth was achievable.

According to analyst Mike Dahl, margins will drop in the current quarter and next year as well. Carryover inflation is likely to be meaningful in 2022, while volume headwinds and a potential return of promotions may pressure margins, he said in his note.

Weaker volumes and margins will be downside catalysts, as per Dahl.

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