Whirlpool Corp (WHR)

JPMorgan just upgraded it to a top pick. She doesn't doesn't know why it's a hated stock. She finds it cute. They have pricing power even with steel costs rising while their last report was impressive. They are buying back $2 billion more shares. They boast a high-single digit PE. For all these reasons, she really likes it.

It depends on the continued DIY trade by homeowners and the hot housing market. JPMorgan just downgraded it.

Sold her shares recently. They're trying to grow in Europe and Asia with acquisitions, but actually lost market share in Europe. Got hurt by deep US steel tariffs. Look elsewhere and cut your losses.

Has attracted him over the years, but has always shied away because it's messy. There seems to always be something introduced that throws them off their game. Whether it’s the US$ moving up or down because a lot of their business comes from outside of the US. They are in court a lot because of their appliances. Just last week, the US government put a tariff on any washing machine, regardless of where it was produced coming into the US. It looks attractive, but he just can't get comfortable enough with it.

It is a global franchise. It has gone through a tough period. Unit sales projection slipped. It is 10 times earnings and 9 times future earnings. The risk is taken out of this stock. There is a 10 year recycling of appliances. (Analysts’ target: $187.00).

Housing starts are coming along nicely. Household formations are changing and millennials are starting to buy their own homes. He prefers HD-N for this play because it is a retailer that covers many different aspects of the whole package. It will grow its dividend and internal measurements.

(A Top Pick Oct 12/16. Up 12%.) The world’s largest appliance manufacturer. In developed markets, it is more of a replacement demand and there was a replacement cycle going on. They recently won a ruling on antidumping by 2 of their largest competitors. In emerging markets, the penetration of appliances in households is very low compared to the US, and she is expecting increased demand for appliances.

He continues to like this. Trading at only 14X earnings. Had some recent disappointments. Anticipated the appliance market would grow 4%-6% this year, but it looks like it is going to grow at only 3.5%. This market doesn’t like disappointments. He likes that he is getting a global franchise that has a reasonable currency play because of the weakness in the US$. A well-run company.

(A Top Pick Oct 3/16. Up 12.13%.) He likes its discipline and its discipline of returning money to shareholders. The balance sheet continues to get better. A great, global franchise.