US Electrical Equipment & Multi-Industry: EE/MI Morning Note – PNR negative pre-announce, FAST Wrap, Small Biz Optimism

Research evidence excerpt

US Electrical Equipment & Multi-Industry: EE/MI Morning Note – PNR negative pre-announce, FAST Wrap, Small Biz Optimism

Global Research

15 July 2026ab

US Electrical Equipment & Multi-Industry Equities

AmericasEE/MI Morning Note – PNR negative pre-

announce, FAST Wrap, Small Biz Optimism Industrial, Diversified

Amit Mehrotra

Analyst

amit.mehrotra@ubs.com

Negative pre-announce from PNR- Yesterday, after the close, Pentair negatively pre- +1-201-352 1410

announced 2Q earnings and revised the 2026 outlook due to the impact of channel

Neal Burk

destocking within Pool. For context, PNR did address the potential for some destocking

in the channel last quarter and cut the outlook for Pool modestly. However, the neal.burk@ubs.com

destocking came in much worse than expected. Management estimates that Pool sales +1-212-713 4066

were negatively impacted by approximately $170 million in 2Q which is a 40% negative

Pratap Singh

impact year over year, and pool segment income was negatively impacted by $105

million, a decremental margin impact of 62%. This would suggest that Pool revenue in pratap-za.singh@ubs.com

2Q could be around $257 million which is lower than what the company did in Pool +1-212-821 3112

during 2Q of 2020. For the full year, management expects the destocking to amount to

Zachary Walljasper

$250 million, suggesting a mid-teens headwind to the Pool segment for the full year or Associate Analyst

6% headwind to total company. Following yesterday's close, the stock down was down zachary.walljasper@ubs.com

27% year to date, in which case some downside may have already been priced in. But, +1-212-713 9829

this pre-announcement was far weaker than what was expected, and we expect the

stock to see further pressure today. This update will bolster market share/competitive