Analyst Names Whirlpool Stock a "Top Pick"

WHR has bounced off chart support in the last month

Digital Content Manager
Jul 7, 2021 at 10:02 AM
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Home appliance concern Whirlpool Corporation (NYSE:WHR) is up 1.1% at $219.57 at last check, after J.P. Morgan Securities named the stock a "top pick." The analyst in question said the "hated name" could beat expectations, and that Wall Street's negative sentiment towards the company is unwarranted. The brokerage's $278 price target is an over 28% premium to last night's close.

As the firm alluded to, analysts are mostly skeptical of Whirlpool stock. Of the five in coverage, four gave the security a tepid "hold" rating. Amongst short sellers, there's similar sentiment, making the equity ripe for a short squeeze. The 4.50 million shares sold short make up 7.4% of WHR's available float, accounting for over a week's worth of pent-up buying power, at the stock's average pace of trading.
 
A shift in the options pits would fuel additional tailwinds for Whirlpool stock, too. This is per WHR's 10-day put/call volume ratio of 1.84 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the 83rd percentile of its annual range. This indicates puts have been more popular than usual over the past two weeks.
 
Now seems like an ideal time to weigh in on Whirlpool stock's next move higher with options. The stock's Schaeffer's Volatility Index (SVI) of 25% sits in the 10th percentile of readings from the past 12 months, meaning options players are pricing in low volatility expectations.
 
WHR's bounce off its 160-day moving average has been picking up steam over the past couple of weeks. However, the shares still have a ways to go before reclaiming their May 10, all-time high of $257.67. Nevertheless, WHR is up 62.7% year-over-year, with today's pop putting the equity on track for its fifth win in six sessions.

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