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POOL's Q3 Earnings & Revenues Beat Estimates, Stock Down
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Pool Corporation (POOL - Free Report) reported third-quarter 2022 results, with its earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis.
Following the announcement, shares of the company declined 4.8% during trading hours on Oct 20. Negative investor sentiments were witnessed as the company narrowed its earnings guidance for 2022.
Earnings & Revenues Discussion
During the third quarter of 2022, the company reported adjusted earnings per share (EPS) of $4.76, surpassing the Zacks Consensus Estimate of $4.55. In the prior-year quarter, the company had reported an adjusted EPS of $4.44.
Quarterly net revenues of $1,615.3 million beat the consensus mark of $1,611 million. Moreover, the top line increased 14.5% year over year. The upside was backed by solid demand for connected and smart technology products like automation, variable speed pumps, robotic cleaners and customizations.
Pool Corporation Price, Consensus and EPS Surprise
Pool reports operations under two segments — The Base Business (constituting most of the business) and the Excluded (sale centers excluded from the Base business).
During the third quarter, revenues in the Base Business segment increased 10.1% year over year to $1,552.2 million. Operating income rose 6.5% year over year to $252.6 million. The operating margin contracted 50 basis points (bps) from the year-ago quarter’s level to 16.3%.
The Excluded segment reported net revenues of $63.1 million in the third quarter compared with $1.6 million reported in the prior-year quarter. During the quarter under review, the segment reported an operating income of $11.2 million compared with $0.3 million reported in the prior-year quarter. The segment’s operating margin came in at 17.8% compared with the 2% reported in the prior-year quarter.
Operating Highlights & Expenses
During the third quarter, the cost of sales came in at $1,111.7 million, up 14.7% from the prior-year quarter’s level. During the quarter, gross profits (as a percentage of net sales) decreased 10 bps year over year to 31.2% from 31.3% reported in the year-ago quarter. Selling and administrative expenses increased 17.2% year over year to $239.8 million.
During the third quarter, operating income increased 11.2% year over year to $263.9 million. The operating margin declined 50 bps to 16.3% from the prior-year quarter’s level.
Net income during the quarter totaled $190.1 million, up from $184.7 million reported in the year-ago quarter.
Balance Sheet
As of Sep 30, 2022, the company’s cash and cash equivalents amounted to $49.1 million compared with $83.5 million as of Sep 30, 2021. During the quarter, its net long-term debt amounted to $1,500.3 million compared with $352.1 million reported in the prior-year quarter. Goodwill during the quarter came in at $691.8 million compared with $281.3 million reported in the prior-year quarter.
During the first nine months of 2022, net cash provided by operating activities amounted to $307.5 million compared with $359.1 million reported in the prior-year quarter.
2022 Guidance
For 2022, Pool expects EPS in the range of $18.50-$19.05 compared to the prior estimate of $18.38-$19.13. The Zacks Consensus Estimate for 2022 earnings is currently pegged at $18.42.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 49.7% and 20.7%, respectively, from the year-ago period’s levels.
Hyatt sports a Zacks Rank #1, at present. H has a trailing four-quarter earnings surprise of 798.8%, on average. The stock has inched up 2.8% in the past year.
The Zacks Consensus Estimate for H’s current financial year sales and EPS indicates a surge of 89.1% and 113%, respectively, from the year-ago period’s reported levels.
Boyd Gaming currently carries a Zacks Rank #2. BYD has a long-term earnings growth rate of 11.4%. The stock has declined 21.1% in the past year.
The Zacks Consensus Estimate for BYD’s current financial year sales and EPS indicates growth of 3.1% and 7.2%, respectively, from the year-ago period’s reported levels.
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POOL's Q3 Earnings & Revenues Beat Estimates, Stock Down
Pool Corporation (POOL - Free Report) reported third-quarter 2022 results, with its earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis.
Following the announcement, shares of the company declined 4.8% during trading hours on Oct 20. Negative investor sentiments were witnessed as the company narrowed its earnings guidance for 2022.
Earnings & Revenues Discussion
During the third quarter of 2022, the company reported adjusted earnings per share (EPS) of $4.76, surpassing the Zacks Consensus Estimate of $4.55. In the prior-year quarter, the company had reported an adjusted EPS of $4.44.
Quarterly net revenues of $1,615.3 million beat the consensus mark of $1,611 million. Moreover, the top line increased 14.5% year over year. The upside was backed by solid demand for connected and smart technology products like automation, variable speed pumps, robotic cleaners and customizations.
Pool Corporation Price, Consensus and EPS Surprise
Pool Corporation price-consensus-eps-surprise-chart | Pool Corporation Quote
Segmental Performance
Pool reports operations under two segments — The Base Business (constituting most of the business) and the Excluded (sale centers excluded from the Base business).
During the third quarter, revenues in the Base Business segment increased 10.1% year over year to $1,552.2 million. Operating income rose 6.5% year over year to $252.6 million. The operating margin contracted 50 basis points (bps) from the year-ago quarter’s level to 16.3%.
The Excluded segment reported net revenues of $63.1 million in the third quarter compared with $1.6 million reported in the prior-year quarter. During the quarter under review, the segment reported an operating income of $11.2 million compared with $0.3 million reported in the prior-year quarter. The segment’s operating margin came in at 17.8% compared with the 2% reported in the prior-year quarter.
Operating Highlights & Expenses
During the third quarter, the cost of sales came in at $1,111.7 million, up 14.7% from the prior-year quarter’s level. During the quarter, gross profits (as a percentage of net sales) decreased 10 bps year over year to 31.2% from 31.3% reported in the year-ago quarter. Selling and administrative expenses increased 17.2% year over year to $239.8 million.
During the third quarter, operating income increased 11.2% year over year to $263.9 million. The operating margin declined 50 bps to 16.3% from the prior-year quarter’s level.
Net income during the quarter totaled $190.1 million, up from $184.7 million reported in the year-ago quarter.
Balance Sheet
As of Sep 30, 2022, the company’s cash and cash equivalents amounted to $49.1 million compared with $83.5 million as of Sep 30, 2021. During the quarter, its net long-term debt amounted to $1,500.3 million compared with $352.1 million reported in the prior-year quarter. Goodwill during the quarter came in at $691.8 million compared with $281.3 million reported in the prior-year quarter.
During the first nine months of 2022, net cash provided by operating activities amounted to $307.5 million compared with $359.1 million reported in the prior-year quarter.
2022 Guidance
For 2022, Pool expects EPS in the range of $18.50-$19.05 compared to the prior estimate of $18.38-$19.13. The Zacks Consensus Estimate for 2022 earnings is currently pegged at $18.42.
Zacks Rank & Key Picks
POOL currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Zacks Consumer Discretionary sector are Crocs, Inc. (CROX - Free Report) , Hyatt Hotels Corporation (H - Free Report) and Boyd Gaming Corporation (BYD - Free Report) .
Crocs currently carries a Zacks Rank #2 (Buy). CROX has a long-term earnings growth rate of 15%. Shares of Crocs have decreased 51.1% in the past year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 49.7% and 20.7%, respectively, from the year-ago period’s levels.
Hyatt sports a Zacks Rank #1, at present. H has a trailing four-quarter earnings surprise of 798.8%, on average. The stock has inched up 2.8% in the past year.
The Zacks Consensus Estimate for H’s current financial year sales and EPS indicates a surge of 89.1% and 113%, respectively, from the year-ago period’s reported levels.
Boyd Gaming currently carries a Zacks Rank #2. BYD has a long-term earnings growth rate of 11.4%. The stock has declined 21.1% in the past year.
The Zacks Consensus Estimate for BYD’s current financial year sales and EPS indicates growth of 3.1% and 7.2%, respectively, from the year-ago period’s reported levels.