Shares of appliance maker Maytag
The market's reaction to the news, however, has been largely muted -- and that's not surprising. What most investors want to hear about at Maytag is the struggling Hoover floor-care business, which blighted an otherwise strong operating performance last year. While the Reuters article did say a new labor contract at Hoover should help costs, it also needs to re-energize sales growth. That won't happen until the second half of 2004, even though several new Hoover products already hit the market.
Hoover management has steadfastly told investors to wait for the latter half of 2004. That may seem like a short time from now, but Hoover hasn't seen sales growth for several years. As we discussed in mid-October, 2003 was troublesome, 2002 was mixed, and 2001 was bad. Although, in 2000, investors may remember with hope, new floor-care products helped energize sales growth for the year.
Taken broadly, Friday's Maytag news can be seen to benefit not only Maytag but also appliance competitors Whirlpool
That's significant news. We couldn't say that as recently as January, indicating that investors are perhaps getting behind the marque that made the Maytag man again.
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Fool contributor Dave Marino-Nachison owns shares of GE.