Shares of home-appliance company Whirlpool (NYSE:WHR) are rising today after the company reported results for the second quarter of 2020 that beat Wall Street's expectations. As of 11:30 a.m. EDT, the stock was up 10%.
Beyond the better-than-hoped-for Q2 results, Whirlpool also reported strengthening demand, which is further reason for investor optimism.
Whirlpool's net sales in Q2 came in at $4 billion. This was down 22% from last year. And the company's earnings per share (EPS) according to generally accepted accounting principles (GAAP) were $0.55, down 47% year over year. While both the top and bottom lines were down sharply, they were still ahead of expectations -- expectations attempting to account for the coronavirus pandemic's negative impact.
Maintaining profitability during the pandemic is extremely challenging for a global enterprise like Whirlpool. Sales in North America held up reasonably well, only down 12.5%. However, consumers were given stimulus money and could have used it to make big appliance purchases.
That wasn't the case around the globe, and Whirlpool's results show this. Net sales were down 37% in Asia and down a whopping 51% in Latin America. For perspective, those two regions accounted for 25% of Whirlpool's sales last year. Because of falling sales, they only accounted for 17% of sales this year.
For 2020, Whirlpool's management expects net sales to fall 10% to 15%. That's not great. But it's a sharp improvement from its recent guidance of a sales drop of 13% to 18%. In other words, sales trends have improved in a very short time, which is good reason for investors to be cheering this blue-chip stock today.
Whirlpool stock now trades near its 52-week highs.