Overview

* Latham Group Inc ( SWIM ) Q2 net sales rise 7.8% but miss analyst expectations, per LSEG data

* Adjusted EBITDA for Q2 beats estimates, driven by margin expansion and efficiencies

* The maker of of in-ground residential swimming pools, liners, and covers reconfirms FY guidance for 8% sales growth

Outlook

* Company reconfirms full-year guidance of 8% net sales growth

* Latham projects 2025 adjusted EBITDA growth of 19% at midpoints

* Company expects 2025 net sales between $535 mln and $565 mln

* Latham forecasts adjusted EBITDA between $90 mln and $100 mln

Result Drivers

* FIBERGLASS POOLS - Strong growth in fiberglass pool sales driven by targeted marketing and consumer recognition of their benefits, per CEO Scott Rajeski

* AUTOCOVERS - Significant increase in autocover sales due to consumer interest in safety and cost savings, along with Coverstar acquisitions

* GROSS MARGIN EXPANSION - 400-basis-point increase attributed to higher volumes, lean manufacturing, and recent acquisitions

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Sales Miss $172.60 $173.40

mln mln (8

Analysts

)

Q2 EPS $0.13

Q2 Net $16 mln

Income

Q2 Beat $39.90 $39 mln

Adjusted mln (7

EBITDA Analysts

)

Q2 Gross 37.1%

Margin

Q2 23.1%

Adjusted

EBITDA

Margin

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 1 "hold" and 2 "sell" or "strong sell"

* The average consensus recommendation for the recreational products peer group is "buy"

* Wall Street's median 12-month price target for Latham Group Inc ( SWIM ) is $8.00, about 15.7% above its August 4 closing price of $6.74

* The stock recently traded at 51 times the next 12-month earnings vs. a P/E of 38 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)