Is Whirlpool (WHR) Likely to Miss Earnings this Quarter?

Whirlpool Corp. WHR, the largest home-appliances manufacturer in the world, is slated to post its second-quarter 2014 results on Jul 23, 2014. In the previous quarter, the company delivered a negative earnings surprise of 4.4%. Let's see how things are shaping up for this announcement.

Factors Influencing the Quarter

Whirlpool is poised to witness remarkable growth in the year ahead driven by its global expansion strategies and ongoing cost and capacity reduction initiatives. However, we cannot ignore the near-term headwinds such as lingering macroeconomic challenges in Venezuela and Argentina which could negatively impact its financials. Keeping this in view, we are not very optimistic about the company's upcoming results.

Earnings Whispers?

Our proven model does not conclusively show that Whirlpool is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP (Expected Surprise Prediction) and a Zacks Rank of #1, 2 or 3 for this to happen. This is not the case here as you will see below.

Zacks ESP: Whirlpool currently has an Earnings ESP of -9.76%. This is because the Most Accurate estimate stands at $2.59 a share, while the Zacks Consensus Estimate is pegged at $2.87 per share.

Zacks Rank #4 (Sell): Whirlpool's Zacks Rank #4 (Sell) when combined with a negative ESP makes surprise prediction unlikely. We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

Avis Budget Group Inc. CAR, Earnings ESP of +3.18% and a Zacks Rank #2 (Buy).

Colgate-Palmolive Co. CL, Earnings ESP of +1.37% and a Zacks Rank #2.

Clorox Company CLX, Earnings ESP of +1.49% and a Zacks Rank #3 (Hold).

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WHIRLPOOL CORP WHR: Free Stock Analysis Report
 
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