Pool Corp. (POOL): 2Q26 Recap: Near-Term Margin Headwinds Offset by Revenues with Execution Suggesting Upside to Estimates

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Pool Corp. (POOL): 2Q26 Recap: Near-Term Margin Headwinds Offset by Revenues with Execution Suggesting Upside to Estimates

Goldman Sachs Pool Corp. (POOL)

historical range on below mid-cycle EPS forecasts. Given this, and our view EPS is at or

close to a trough, we see the potential for meaningful upside as these efforts come

through and maintain our Buy rating.

Upside to Pricing and Share Gains to Benefit Revenues: On the call, management

noted the growth in 2Q revenues was led by pricing up 3pts given increases last May in

response to tariffs. Pool also benefited from share gains in building materials, resilient

maintenance demand, and the overall breadth of the product portfolio. This is despite

continued weakness in new pool construction, with permits running down low-single

digits YTD, leading to a modest revision in the full year outlook to flat to slightly down vs

prior expectations for flat YOY. We also highlight 11% growth in Europe as the very hot

weather helped drive gains against a tough comp of +7% last year, and equipment up 3%

more than offsetting a 2% decline in chemicals given lower pricing. In line with housing,

Horizon sales fell 5% YOY. By geography, we note seasonal markets grew 6% vs a

mid-single digit decline in Texas, California, and Arizona while Florida was down 1%

given pull forward around the 1Q early buy across these states. Looking out, we are

encouraged as Pool focuses on leveraging the scale and geographic reach of its network

along with investments in technology to help differentiate itself vs peers. This includes

the adoption of Pool360, which rose to 18% of sales vs 13% in 1Q. For the second half,

pricing is expected to moderate as we move past the spring 2025 increases with a guide

for +2% for the year.