Shares of companies in the pool industry faced a decline in premarket trading following a warning from Leslie’s, a leading provider of pool chemicals and after-market products. The company cited soft demand as the reason for the caution.

Latham Group, a prominent in-ground pool builder, experienced an almost 8% drop in its stock price to $4.20 during premarket trading. Hayward Holdings also faced a significant decline, with their stock dropping nearly 9% to $12.39. Pool Corp., another player in the industry, saw its shares fall more than 6% to $359.38.

Leslie’s, in an announcement made on Thursday evening, revised its sales and earnings outlook for the fiscal year due to unusual weather patterns and a more price-conscious consumer base. CEO Mike Egeck explained that pool owners in America had accumulated a larger inventory of pool supplies and chemicals than usual, which put pressure on sales.

As a result of the news, Leslie’s experienced a substantial decline of over 33% in its stock price, which fell to $6.35 during premarket trading.

Analysts at Stifel noted that this update highlights a more challenging environment for the pool industry, although they believe the impact is primarily confined to Leslie’s and other independent retailers of pool supplies. They pointed out that almost half of Leslie’s sales come from chemicals, making the company more vulnerable compared to others in the market.

While Pool Corp., a key player in the industry, may also be affected by the softer market environment, the analysts believe they rely less on chemical sales compared to Leslie’s. They also suggested that Hayward, which offers a variety of products such as pumps and robotic cleaners, as well as Latham, may not be significantly impacted by the update from Leslie’s.

In conclusion, it is evident that the pool industry is currently facing challenges due to soft demand and changing consumer behavior. The situation has led to stock price declines for various companies in the industry, with Leslie’s being the most affected. However, the full extent of this impact may vary for different players in the market.

Leave a Reply

3  +  3  =