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PNR Q3 Earnings Beat Estimates, Revenues Dip Y/Y on Pool Weakness
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Key Takeaways
Pentair's Q3 adjusted EPS of $1.18 beat estimates by 10.28% despite declining 4.8% y/y.
Pool sales fell 17.7%, weighing on profitability, while Flow and Water Solutions delivered income growth.
Pentair reaffirmed its 2026 adjusted EPS view of $4.70 and narrowed its expected revenue decline to 3%.
Pentair plc (PNR - Free Report) reported adjusted earnings of $1.18 per share for the third quarter of 2026, beating the Zacks Consensus Estimate of $1.07 by 10.28%. However, earnings declined 4.8% from $1.24 in the year-ago quarter.
Including one-time items, earnings per share (EPS) were 91 cents compared with $1.12 in the prior-year quarter.
Revenues fell 4.5% year over year to $976 million but surpassed the Zacks Consensus Estimate of $964 million by 1.3%.
Core sales declined 5.5% as lower volumes more than offset favorable pricing and acquisition contributions. The decline primarily reflected the completion of channel inventory destocking in the Pool segment, wherein core sales fell 17.8%.
Pentair Sees Contraction in Q3 Operating Margin
Cost of goods sold declined 3.7% year over year to $581 million. Gross profit fell 5.6% to $395 million, while the gross margin contracted 50 basis points to 40.5%.
Selling, general and administrative expenses increased 8.4% to $176 million, while research and development spending declined 5.3% to $23 million. Reported operating income dropped 15.5% to $196 million.
Adjusted operating income declined 7.8% year over year to $242 million, reflecting inflationary pressures and lower Pool volumes, partially offset by productivity improvements and tariff recoveries.
PNR Q3 Segmental Performance
Flow revenues increased 4.4% year over year to $262.5 million, supported by acquisitions and pricing. We expected revenues of $274 billion for the segment. Segment income rose 15.2% to $68.8 million. Growth in Flow benefited from strong performance across much of the portfolio, including the Hydra-Stop acquisition. However, delayed spending in food and beverage weighed on sales.
Water Solutions revenues increased 1.4% to $422 million. The figure was in line with our estimate. Segment income advanced 16.3% to $120.9 million. Productivity gains, pricing exceeding inflation and tariff refunds supported segment profitability.
Pool revenues declined 17.7% year over year to $291.5 million, reflecting the previously communicated channel inventory realignment. Lower volumes remained the principal headwind, although pricing provided some relief. Our model estimates the segment’s revenues at $266 million for the quarter. Segment income plunged 38.3% to $71.7 million. Lower operating leverage, inflation and growth investments pressured profitability.
Net cash provided by operating activities was $169 million compared with $196 million in the year-ago quarter. The free cash flow totaled $153 million, down from $179 million. For the first nine months, the free cash flow reached $619.9 million.
Pentair ended September 2026 with $74 million in cash and cash equivalents compared with $102 million at the end of December 2025. The company repurchased $350 million in shares in the first nine months and paid out a quarterly dividend of 27 cents per share.
Pentair also completed its acquisition of Taco Group Holdings on Oct. 1, 2026. The acquisition expands its water-management portfolio into hydronic solutions and strengthens exposure to commercial, residential and infrastructure markets. The company expects the transaction to contribute positively to adjusted earnings in 2027.
PNR Reaffirms 2026 Earnings Outlook
Pentair expects fourth-quarter 2026 adjusted earnings of $1.15 per share. Revenues are projected to increase 7-9% year over year, including contributions from the Taco acquisition.
For 2026, PNR reaffirmed its adjusted earnings guidance midpoint of $4.70 per share. Full-year revenues are projected to decline 3% compared with the earlier expectation of a 4-7% decrease.
The updated outlook includes the Taco acquisition and Pool channel inventory adjustments. The company expects full-year adjusted operating income to decline 6%, while targeting free cash flow exceeding 100% of net income.
Pentair Stock's Price Performance
The PNR stock has lost 49.3% over the past year compared with the industry’s 1.4% decline.
Pool Corp. (POOL - Free Report) reported adjusted earnings of $3.40 per share, beating the Zacks Consensus Estimate of $3.36 per share. This marks a 0.3% increase from the earnings of $3.39 per share reported a year ago.
POOL posted revenues of $1.51 billion for the quarter, surpassing the Zacks Consensus Estimate of $1.47 billion. The revenue figure marked a 3.7% year-over-year increase.
Xylem Inc. (XYL - Free Report) reported adjusted EPS of $1.44, missing the Zacks Consensus Estimate of $1.47. The company reported earnings of $1.37 in the year-ago quarter.
XYL reported revenues of $2.2 billion in the quarter, missing the Zacks Consensus Estimate of $2.3 billion. The company posted revenues of $2.3 billion in the third quarter of 2025.
PNR Peer Awaiting Results
Clean Harbors, Inc. (CLH - Free Report) , scheduled to release third-quarter 2026 results tomorrow, has a trailing four-quarter average earnings surprise of 4%. The Zacks Consensus Estimate for Clean Harbors’ earnings for the quarter is pegged at $3.18 per share, implying year-over-year growth of 44%.
The consensus estimate for Clean Harbors’ top line is pegged at $1.72 billion, indicating a rise of 11% from the prior-year reported figure.
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PNR Q3 Earnings Beat Estimates, Revenues Dip Y/Y on Pool Weakness
Key Takeaways
Pentair plc (PNR - Free Report) reported adjusted earnings of $1.18 per share for the third quarter of 2026, beating the Zacks Consensus Estimate of $1.07 by 10.28%. However, earnings declined 4.8% from $1.24 in the year-ago quarter.
Including one-time items, earnings per share (EPS) were 91 cents compared with $1.12 in the prior-year quarter.
Pentair plc Price, Consensus and EPS Surprise
Pentair plc price-consensus-eps-surprise-chart | Pentair plc Quote
PNR's Q3 Revenues Hurt by Pool Weakness
Revenues fell 4.5% year over year to $976 million but surpassed the Zacks Consensus Estimate of $964 million by 1.3%.
Core sales declined 5.5% as lower volumes more than offset favorable pricing and acquisition contributions. The decline primarily reflected the completion of channel inventory destocking in the Pool segment, wherein core sales fell 17.8%.
Pentair Sees Contraction in Q3 Operating Margin
Cost of goods sold declined 3.7% year over year to $581 million. Gross profit fell 5.6% to $395 million, while the gross margin contracted 50 basis points to 40.5%.
Selling, general and administrative expenses increased 8.4% to $176 million, while research and development spending declined 5.3% to $23 million. Reported operating income dropped 15.5% to $196 million.
Adjusted operating income declined 7.8% year over year to $242 million, reflecting inflationary pressures and lower Pool volumes, partially offset by productivity improvements and tariff recoveries.
PNR Q3 Segmental Performance
Flow revenues increased 4.4% year over year to $262.5 million, supported by acquisitions and pricing. We expected revenues of $274 billion for the segment. Segment income rose 15.2% to $68.8 million. Growth in Flow benefited from strong performance across much of the portfolio, including the Hydra-Stop acquisition. However, delayed spending in food and beverage weighed on sales.
Water Solutions revenues increased 1.4% to $422 million. The figure was in line with our estimate. Segment income advanced 16.3% to $120.9 million. Productivity gains, pricing exceeding inflation and tariff refunds supported segment profitability.
Pool revenues declined 17.7% year over year to $291.5 million, reflecting the previously communicated channel inventory realignment. Lower volumes remained the principal headwind, although pricing provided some relief. Our model estimates the segment’s revenues at $266 million for the quarter. Segment income plunged 38.3% to $71.7 million. Lower operating leverage, inflation and growth investments pressured profitability.
Pentair Generates Cash & Maintains Shareholder Returns
Net cash provided by operating activities was $169 million compared with $196 million in the year-ago quarter. The free cash flow totaled $153 million, down from $179 million. For the first nine months, the free cash flow reached $619.9 million.
Pentair ended September 2026 with $74 million in cash and cash equivalents compared with $102 million at the end of December 2025. The company repurchased $350 million in shares in the first nine months and paid out a quarterly dividend of 27 cents per share.
Pentair also completed its acquisition of Taco Group Holdings on Oct. 1, 2026. The acquisition expands its water-management portfolio into hydronic solutions and strengthens exposure to commercial, residential and infrastructure markets. The company expects the transaction to contribute positively to adjusted earnings in 2027.
PNR Reaffirms 2026 Earnings Outlook
Pentair expects fourth-quarter 2026 adjusted earnings of $1.15 per share. Revenues are projected to increase 7-9% year over year, including contributions from the Taco acquisition.
For 2026, PNR reaffirmed its adjusted earnings guidance midpoint of $4.70 per share. Full-year revenues are projected to decline 3% compared with the earlier expectation of a 4-7% decrease.
The updated outlook includes the Taco acquisition and Pool channel inventory adjustments. The company expects full-year adjusted operating income to decline 6%, while targeting free cash flow exceeding 100% of net income.
Pentair Stock's Price Performance
The PNR stock has lost 49.3% over the past year compared with the industry’s 1.4% decline.
Image Source: Zacks Investment Research
PNR’s Zacks Rank
Pentair currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quick Look at How Pentair’s Peers Fared in Q3
Pool Corp. (POOL - Free Report) reported adjusted earnings of $3.40 per share, beating the Zacks Consensus Estimate of $3.36 per share. This marks a 0.3% increase from the earnings of $3.39 per share reported a year ago.
POOL posted revenues of $1.51 billion for the quarter, surpassing the Zacks Consensus Estimate of $1.47 billion. The revenue figure marked a 3.7% year-over-year increase.
Xylem Inc. (XYL - Free Report) reported adjusted EPS of $1.44, missing the Zacks Consensus Estimate of $1.47. The company reported earnings of $1.37 in the year-ago quarter.
XYL reported revenues of $2.2 billion in the quarter, missing the Zacks Consensus Estimate of $2.3 billion. The company posted revenues of $2.3 billion in the third quarter of 2025.
PNR Peer Awaiting Results
Clean Harbors, Inc. (CLH - Free Report) , scheduled to release third-quarter 2026 results tomorrow, has a trailing four-quarter average earnings surprise of 4%. The Zacks Consensus Estimate for Clean Harbors’ earnings for the quarter is pegged at $3.18 per share, implying year-over-year growth of 44%.
The consensus estimate for Clean Harbors’ top line is pegged at $1.72 billion, indicating a rise of 11% from the prior-year reported figure.