RBC reiterates Underperform, sets $51 target
RBC Capital has repeated its Underperform rating on Whirlpool Corporation with an unchanged price target of $51.00, a level well below the stock's most recent trade at $76.96 and implying about a 34% downside. InvestingPro data cited by RBC indicate analyst price targets for Whirlpool span a wide band from $51 to $145.
Rationale: earnings miss and difficult guidance
The firm’s update follows Whirlpool's fourth-quarter results, which RBC says included an earnings miss relative to expectations and a fiscal 2026 guidance that it characterizes as "tough-to-bridge-to." As a result, RBC lowered its adjusted EBITDA estimates for fiscal 2026 and fiscal 2027 to levels 9% and 10% below consensus, respectively. For context, Whirlpool's reported EBITDA for the trailing twelve months is $1.08 billion, while current consensus EPS forecasts for FY2026 stand at $7.52.
Margins remain a focal point
RBC emphasized margin pressure as a central concern. The bank noted that although Whirlpool gained some market share in the second half of the year, the company "exited weak on margins." InvestingPro data cited in the analysis show gross profit margins of 15.37% over the last twelve months, underscoring the narrow profitability backdrop that RBC says complicates the company's outlook.
The company’s guidance projects strong revenue and margin improvement that is concentrated in the back half of the fiscal year. RBC described that pacing as a risk, highlighting assumptions about a return to "normalized" promotional activity as a "stretch" that would require "many things to go right."
Leverage and cash flow constraints
RBC also flagged Whirlpool's balance sheet and cash flow profile as pressure points. InvestingPro statistics presented with the note include a debt-to-equity ratio of 2.64 and a current ratio of 0.76, indicating that short-term liabilities exceed liquid assets. The firm pointed to limited free cash flow after dividend payments and noted the potential for increased strain if core operations continue to fall short of expectations.
InvestingPro data show Whirlpool's levered free cash flow at $78 million for the last twelve months. While the company has sustained dividend payments for 55 consecutive years, the dividend currently yields 4.68% and RBC warns that the low level of levered free cash flow could put pressure on that streak should operational results not improve.
Quarterly results: earnings beat, revenue miss
Whirlpool's fourth-quarter financials were mixed. The company reported adjusted earnings per share of $1.91, beating the analyst consensus by $0.38 versus an expected $1.53. Revenue for the quarter, however, came in at $4.1 billion versus expectations of $4.28 billion, representing a top-line shortfall. Investors and analysts have focused on that disconnect between an earnings beat and a revenue miss in assessing the company's near-term trajectory.
What RBC is watching
In sum, RBC's sustained Underperform rating is driven by skepticism around Whirlpool's ability to deliver the guidance profile and margin recovery it has outlined, revised EBITDA estimates materially below consensus, and balance-sheet and cash-flow metrics that leave little cushion for operational missteps. The combination of narrow gross margins, high leverage and modest levered free cash flow underpins the firm's cautious stance.
This piece presents the analyst view and the financial metrics cited by RBC and InvestingPro. The data points and company figures in this article are those referenced in the analyst note and InvestingPro extracts.