NEW YORK (Reuters) - Whirlpool Corp (WHR.N) quarterly profit more than doubled on cost cuts and improving sales in North America, prompting the world’s biggest appliance maker to forecast 2010 earnings above Wall Street estimates.
The results came a day after data showed U.S. manufacturing expanded in January at its fastest pace since 2004, renewing hopes the U.S. economy has turned the corner.
Whirlpool shares rose 6.3 percent to $80.87.
Unlike previous quarters when the company relied on emerging markets like Brazil and Asia to cushion weak demand at home, Whirlpool’s fourth-quarter sales rose in North America -- its largest market -- as well as in international markets.
The maker of Maytag and KitchenAid appliances said it expects consumer confidence “to be stable to slightly up” in the United States, adding that it was well positioned to benefit from fast-growing markets like China and India.
“We view 2010 as a year of full recovery for our company,” Chief Executive Officer Jeff Fettig said on a conference call.
For 2010, Whirlpool forecast earnings of $6.50 to $7.00 per share and sees U.S. industry unit shipments up 2 percent to 4 percent. Analysts were expecting $6.45 per share, according to Thomson Reuters I/B/E/S.
“I think they are being realistic, given the demand trends that they are seeing in China, Latin America and the United States,” Wall Street Strategies analyst Brian Sozzi said.
“We believe a strong case could be made the stock remains attractively valued in light of what’s likely to be hiked 2010 estimates and solid demand trends at least into the third quarter,” he added.
The sluggish economy and weak housing market have dented sales at Whirlpool and other appliance makers like Sweden’s Electrolux (ELUXb.ST).
Last month, Whirlpool told Reuters it was “cautiously optimistic” about 2010 but warned that demand for appliances might come in fits and starts.
Fourth-quarter net income rose to $95 million, or $1.24 per share, from $44 million, or 60 cents per share, a year earlier. The results included an expense of 40 cents a share from a legal action.
Sales rose 13 percent to $4.9 billion. Analysts on average were expecting $4.44 billion, according to Thomson Reuters I/B/E/S.
Sales in North America rose 4 percent to $2.6 billion, while unit shipments increased 8 percent.
The company is rolling out several new energy-efficient products this year to woo consumers who are looking for ways to cut their energy bills and need to replace household appliances too old for repair.
Whirlpool is also aggressively cutting costs by shutting plants and cutting jobs.
Reporting by Dhanya Skariachan; Editing by Lisa Von Ahn, Dave Zimmerman and John Wallace