Shares of swimming pool and lifestyle product maker, Pool Corporation (POOL - Free Report) were up over 5% in yesterday’s trading session, after the company reported better-than-expected third-quarter 2017 results.
Quarter Discussion
Pool’s third-quarter earnings of $1.16 per share surpassed the Zacks Consensus Estimate of $1.14 by 1.8%. Moreover, the figure rose 13% on a year-over-year basis backed by higher sales.
Net sales came in at $743.4 million, marking an increase of 8% year over year. Continued increases in swimming pool repair and remodel activities including major pool refurbishment and replacement of key pool equipment, led to the improvement in sales. As a result, sales outpaced the Zacks Consensus Estimate of $728 million by over 2%.
The recent weather events negatively impacted the quarter’s earnings and sales by roughly 2 cents and $4 million, respectively.
Behind the Headline Numbers
Pool reports operations under two segments, the Base Business segment (constituting majority portion of the business) and the Excluded segment (sale centers excluded from base business).
The Base business segment witnessed sales growth of 6% year over year, given the resiliency and favorable characteristics inherent to its business and consistent market share gains.
Gross profit increased 9% year over year to a record of $216.6 million, with base business gross profit increasing 7%. Also, the company’s gross margin in the third quarter was 29.1%, up 20 basis points (bps) year over year, given product mix and benefits from sourcing initiatives.
Additionally, selling and administrative expenses (operating expenses) increased roughly 7% year over year to $134.7 million in the reported quarter, with base business operating expenses increasing 5%.
While operating income improved 10% from the year-ago quarter to $81.9 million, operating margin increased 30 bps year over year to 11%.
Earnings Guidance for 2017
For 2017, Pool anticipates earnings in the band of $4.01 to $4.11 per share, down from the earlier guided range of $4.12–$4.32. The Zacks Consensus Estimate for the same is pegged at $4.06.
Zacks Rank & Peer Releases
Pool carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other stocks in the same sector, Carnival Corporation (CCL - Free Report) reported solid third-quarter fiscal 2017 results in the last month, with the bottom and the top line beating the Zacks Consensus Estimate.
While Polaris Industries Inc. (PII - Free Report) is expected to post third-quarter earnings on Oct 24, Brunswick Corporation (BC - Free Report) will be releasing its quarterly numbers on Oct 26. The Zacks Consensus Estimate for the quarter’s EPS is pegged at $1.22 for Polaris and $1.01 for Burnswick.
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Shares of swimming pool and lifestyle product maker, Pool Corporation (POOL - Free Report) were up over 5% in yesterday’s trading session, after the company reported better-than-expected third-quarter 2017 results.
Quarter Discussion
Pool’s third-quarter earnings of $1.16 per share surpassed the Zacks Consensus Estimate of $1.14 by 1.8%. Moreover, the figure rose 13% on a year-over-year basis backed by higher sales.
Net sales came in at $743.4 million, marking an increase of 8% year over year. Continued increases in swimming pool repair and remodel activities including major pool refurbishment and replacement of key pool equipment, led to the improvement in sales. As a result, sales outpaced the Zacks Consensus Estimate of $728 million by over 2%.
The recent weather events negatively impacted the quarter’s earnings and sales by roughly 2 cents and $4 million, respectively.
Behind the Headline Numbers
Pool reports operations under two segments, the Base Business segment (constituting majority portion of the business) and the Excluded segment (sale centers excluded from base business).
The Base business segment witnessed sales growth of 6% year over year, given the resiliency and favorable characteristics inherent to its business and consistent market share gains.
Gross profit increased 9% year over year to a record of $216.6 million, with base business gross profit increasing 7%. Also, the company’s gross margin in the third quarter was 29.1%, up 20 basis points (bps) year over year, given product mix and benefits from sourcing initiatives.
Additionally, selling and administrative expenses (operating expenses) increased roughly 7% year over year to $134.7 million in the reported quarter, with base business operating expenses increasing 5%.
While operating income improved 10% from the year-ago quarter to $81.9 million, operating margin increased 30 bps year over year to 11%.
Earnings Guidance for 2017
For 2017, Pool anticipates earnings in the band of $4.01 to $4.11 per share, down from the earlier guided range of $4.12–$4.32. The Zacks Consensus Estimate for the same is pegged at $4.06.
Zacks Rank & Peer Releases
Pool carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Among other stocks in the same sector, Carnival Corporation (CCL - Free Report) reported solid third-quarter fiscal 2017 results in the last month, with the bottom and the top line beating the Zacks Consensus Estimate.
While Polaris Industries Inc. (PII - Free Report) is expected to post third-quarter earnings on Oct 24, Brunswick Corporation (BC - Free Report) will be releasing its quarterly numbers on Oct 26. The Zacks Consensus Estimate for the quarter’s EPS is pegged at $1.22 for Polaris and $1.01 for Burnswick.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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