JP Morgan Neutral on Whirlpool After 3Q Miss, Chalks Up to Restructuring

JP Morgan has published a research report on Whirpool Corporation WHR after the company reported 3Q earnigns that missed consensus estimates. In the report, JP Morgan writes, "WHR reported 3Q Operating EPS of $2.35 (excludes $0.08/share related to ongoing Embraco antitrust matters), solidly below our $2.93E and the Street's $2.47. More importantly, however, the company lowered 2011 Operating EPS guidance to a range of $9.50-$10.00 from the low end of the previous $12.00-$13.00 range (this includes $3.70/share and $1.05/share related to WHR's previously announced Brazilian collection dispute and Embraco antitrust matters, respectively); FCF guidance was also lowered from $160-$260 million to ($150)-($200) million. While we view this as a material disappointment, at the same time, we believe a likely negative stock reaction should be moderated by the company's aggressive restructuring program announced today, which represents roughly $3.85/share of annualized savings (assuming a 25% tax rate) to be achieved through 2013-end." JP Morgan maintains its Neutral rating on Whirlpool, which closed yesterday at $60.47.