Spin Cycle Stock Pick for Turbulent Times: WHR

I know the market is a little spooky today. But you know, as markets shift into a more defensive mode, I continue to think a perfect place for you to be and sleep better at night is Whirlpool (NYSE:WHR).

The company is trading at a very low valuation and that attracts big time investors, particularly when times get turbulent like they have been the last couple of sessions. The P/E is 10, the PEG ratio 0.56, trading at half the times sells and two times book.

We all know and love the brands: Whirlpool, Maytag, Kitchenaid, Jenn-Air and Amana. There are a whole lot of others that are household names overseas, as well.

Speaking of which, it is a global play. They have their tentacles everywhere. Market share in North America is number one, number one in Latin America, number three in India, number four in Europe, Middle East and Africa. Mostly though, a lot of room for potential growth in Eastern Europe and those BRIC nations.

And don’t forget, in the U.S. we are starting just now to see normalized demand. Demand for this kind of stuff plunged from 2005 to 2012, so now we are seeing upside momentum. I think it is going to continue to be driven by new construction, existing home sales and finally replacements.

So look for top-line growth, but I think the real valuation proposition with this one comes from the ability to expand its margins. Remember expanding margins, means higher stock prices. Revenues are going to be great, increased cash flows are going to be great as well. I like the company's deal with Nest, they are going to start with washers and dryers already available on Homedepot.com (NYSE:HD).

So for this year, my price target is $160. But I think sometime next year, this could be a $190 stock.