One day after Whirlpool Corp (WHR 1.58%) issued common stock and depositary shares, leading the company's stock to plummet, billionaire investor David Tepper sent a blistering letter to the company's board of directors, accusing the company of destroying shareholder value and failing to adopt a prudent strategy. The letter was first obtained and reported on by CNBC's Andrew Ross Sorkin.
"Over the years this management team has destroyed hundreds of millions of dollars of shareholder value. Enough is enough. There can be no more excuses," Tepper wrote.
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Whirlpool, a maker of home appliance brands such as Maytag, has seen its stock fall by nearly 32% over the past year. The stock recently got crushed by the capital raise, which involved issuing nearly $455 million of common stock and $508 million of depositary shares representing fractions of newly issued mandatory convertible preferred stock.
Tepper's fund, Appaloosa Management, held roughly $282 million of Whirlpool stock at the end of 2025, allocating over 4% of the fund's capital to the position. However, Appaloosa also sold about 29% of its stake in the fourth quarter.
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Specifically, Tepper said he was shocked to see the company issuing equity at a cost of capital exceeding 10%, despite its tax-adjusted debt costing below 5% in the market. Investors want companies to raise capital at the lowest possible cost.
Now, along with automating its operations, Whirlpool is also looking to deleverage, so management was probably looking to take on as little new debt as possible.
Tepper is also not pleased with the company's strategic direction, criticizing Whirlpool for not taking advantage of President Donald Trump's tariffs and arguing that management should have pursued partnerships or acquisitions with foreign companies hurt by the tariffs to improve its market position.
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"We encourage the Board to (i) remember their fiduciary responsibilities and not accept management acting purely in its own self-interest, and (ii) invite domestic entities or foreign corporations who want to create American jobs and increase shareholder value to take an interest in Whirlpool," Tepper wrote.
Given the sell-off, shares of Whirlpool now trade at less than 11 times forward earnings and 0.3 times forward revenue, making the stock cheap. However, it's clear the company is dealing with secular headwinds, such as a slowing housing market and lower demand for home appliances.
Despite Appaloosa's reduced position in the name, Tepper is clearly interested in the company, which could indicate that he and his team still see hope for it.
Lower home prices and interest rates could eventually get the housing market moving, and deleveraging can be a powerful catalyst for a stock price, but neither is guaranteed. I see no reason to rush into the stock, but investors should continue to monitor it for signs of progress.
