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Pool Corp (POOL) Q1 Earnings Miss Estimates, Decline Y/Y
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Pool Corporation (POOL - Free Report) reported drab first-quarter 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. Also, the top and the bottom line declined from the prior-year quarter's figure. During the quarter, the company’s operations were affected by lower pool construction activity, economic pressures and weather-related constraints.
Following the announcement, the company’s shares dropped 2% during trading hours on Apr 25.
The company raised its annual earnings guidance range to account for year-to-date tax benefits. It expects sales and gross margin trends to improve with the onset of the swimming pool season, aligning with seasonal buying patterns.
Earnings & Revenues Discussion
During the first quarter, the company reported adjusted earnings per share (EPS) of $1.85, missing the Zacks Consensus Estimate of $1.87. In the prior-year quarter, the company reported an adjusted EPS of $2.46.
Pool Corporation Price, Consensus and EPS Surprise
Quarterly net revenues of $1.12 billion missed the consensus mark of $1.13 billion. The top line declined 7% year over year. The downside was caused by lower sales volume from reduced pool construction and discretionary activities.
Operating Highlights & Expenses
During the first quarter, the cost of sales came in at $782.3 million compared with $837 million reported in the prior-year quarter. Our estimate for the cost of sales was $783.7 million.
During the quarter, gross profits (as a percentage of net sales) declined 40 basis points (bps) year over year to 30.2% from 30.6% reported in the year-ago quarter. The metric was in line with our estimate.
During the first quarter, operating income declined 25.4% year over year to $108.7 million. Our estimate for operating income was $102.7 million. The operating margin came in at 9.7%, down 240 bps from the prior-year quarter’s level.
Selling and administrative expenses increased 2.6% year over year to $229.8 million. Our estimate for the metric was $236.8 million.
Net income during the quarter totaled $78.9 million compared with $101.7 million reported in the year-ago quarter. Our estimate for net income was $71.2 million.
Balance Sheet
As of Mar 31, 2024, the company’s cash and cash equivalents amounted to $68 million compared with $66.5 million as of Dec 31, 2023. During the quarter, its net long-term debt amounted to $942.5 million compared with $1.3 billion reported in the year-ago quarter. Goodwill during the quarter came in at $699.4 million compared with $693.2 million reported in the prior-year quarter.
During the quarter, net cash provided by operating activities amounted to $145.4 million compared with $103.2 million reported in the prior-year period.
2024 Guidance Raised
For 2024, Pool Corp expects adjusted EPS in the range of $13.19-$14.19, up from the prior projection of $13-$14. The guidance reflects an increase from an adjusted EPS of $13.18 reported in 2023. The Zacks Consensus Estimate for 2024 earnings is currently pegged at $13.27.
Mattel, Inc. (MAT - Free Report) reported first-quarter 2024 results, wherein earnings surpassed the Zacks Consensus Estimate, but revenues missed the same. The top line missed the consensus estimate for the second straight quarter.
The company experienced robust bottom-line performance, propelled mainly by increased margins and the repurchase of $100 million worth of shares during the quarter and remained aligned with its annual targets. It anticipates ongoing advantages from the Optimizing for Profitable Growth initiative, aiming for $60 million in cost reductions in 2024 and a cumulative $200 million by 2026.
Hilton Worldwide Holdings Inc. (HLT - Free Report) reported solid first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate and rising year over year.
The company's performance was backed by notable improvements in revenue per available room (RevPAR), attributed to higher occupancy rates and average daily rates (ADR). It also benefited from its fee-based business model and robust development initiatives. Hilton maintained its momentum in signings, starts and openings, reflecting a solid pipeline. Based on the growth trajectory observed thus far, the company is optimistic about sustaining the momentum in the near future.
Royal Caribbean Cruises Ltd. (RCL - Free Report) reported stellar first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
RCL benefited from robust demand, strong pricing (on closer-in demand), solid onboard spending and favorable timing of expenses. The company also raised its 2024 adjusted earnings per share (EPS) guidance on the back of an exceptional WAVE season and continued strong demand.
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Pool Corp (POOL) Q1 Earnings Miss Estimates, Decline Y/Y
Pool Corporation (POOL - Free Report) reported drab first-quarter 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. Also, the top and the bottom line declined from the prior-year quarter's figure. During the quarter, the company’s operations were affected by lower pool construction activity, economic pressures and weather-related constraints.
Following the announcement, the company’s shares dropped 2% during trading hours on Apr 25.
The company raised its annual earnings guidance range to account for year-to-date tax benefits. It expects sales and gross margin trends to improve with the onset of the swimming pool season, aligning with seasonal buying patterns.
Earnings & Revenues Discussion
During the first quarter, the company reported adjusted earnings per share (EPS) of $1.85, missing the Zacks Consensus Estimate of $1.87. In the prior-year quarter, the company reported an adjusted EPS of $2.46.
Pool Corporation Price, Consensus and EPS Surprise
Pool Corporation price-consensus-eps-surprise-chart | Pool Corporation Quote
Quarterly net revenues of $1.12 billion missed the consensus mark of $1.13 billion. The top line declined 7% year over year. The downside was caused by lower sales volume from reduced pool construction and discretionary activities.
Operating Highlights & Expenses
During the first quarter, the cost of sales came in at $782.3 million compared with $837 million reported in the prior-year quarter. Our estimate for the cost of sales was $783.7 million.
During the quarter, gross profits (as a percentage of net sales) declined 40 basis points (bps) year over year to 30.2% from 30.6% reported in the year-ago quarter. The metric was in line with our estimate.
During the first quarter, operating income declined 25.4% year over year to $108.7 million. Our estimate for operating income was $102.7 million. The operating margin came in at 9.7%, down 240 bps from the prior-year quarter’s level.
Selling and administrative expenses increased 2.6% year over year to $229.8 million. Our estimate for the metric was $236.8 million.
Net income during the quarter totaled $78.9 million compared with $101.7 million reported in the year-ago quarter. Our estimate for net income was $71.2 million.
Balance Sheet
As of Mar 31, 2024, the company’s cash and cash equivalents amounted to $68 million compared with $66.5 million as of Dec 31, 2023. During the quarter, its net long-term debt amounted to $942.5 million compared with $1.3 billion reported in the year-ago quarter. Goodwill during the quarter came in at $699.4 million compared with $693.2 million reported in the prior-year quarter.
During the quarter, net cash provided by operating activities amounted to $145.4 million compared with $103.2 million reported in the prior-year period.
2024 Guidance Raised
For 2024, Pool Corp expects adjusted EPS in the range of $13.19-$14.19, up from the prior projection of $13-$14. The guidance reflects an increase from an adjusted EPS of $13.18 reported in 2023. The Zacks Consensus Estimate for 2024 earnings is currently pegged at $13.27.
Zacks Rank & Recent Consumer Discretionary Releases
Pool Corp currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mattel, Inc. (MAT - Free Report) reported first-quarter 2024 results, wherein earnings surpassed the Zacks Consensus Estimate, but revenues missed the same. The top line missed the consensus estimate for the second straight quarter.
The company experienced robust bottom-line performance, propelled mainly by increased margins and the repurchase of $100 million worth of shares during the quarter and remained aligned with its annual targets. It anticipates ongoing advantages from the Optimizing for Profitable Growth initiative, aiming for $60 million in cost reductions in 2024 and a cumulative $200 million by 2026.
Hilton Worldwide Holdings Inc. (HLT - Free Report) reported solid first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate and rising year over year.
The company's performance was backed by notable improvements in revenue per available room (RevPAR), attributed to higher occupancy rates and average daily rates (ADR). It also benefited from its fee-based business model and robust development initiatives. Hilton maintained its momentum in signings, starts and openings, reflecting a solid pipeline. Based on the growth trajectory observed thus far, the company is optimistic about sustaining the momentum in the near future.
Royal Caribbean Cruises Ltd. (RCL - Free Report) reported stellar first-quarter 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
RCL benefited from robust demand, strong pricing (on closer-in demand), solid onboard spending and favorable timing of expenses. The company also raised its 2024 adjusted earnings per share (EPS) guidance on the back of an exceptional WAVE season and continued strong demand.