Core Viewpoint - Hayward Holdings Inc. has demonstrated strong performance with a significant increase in net earnings and sales, leading to a new 52-week high in stock price, supported by a positive growth outlook for the full year [1][3]. Financial Performance - Net earnings for the third quarter rose by 45% to $24 million, compared to $16.5 million in the same period last year [3]. - Net sales increased by 7.4% to $244 million from $227 million year-on-year, driven by positive net pricing, increased volume, and favorable foreign currency translation [3]. Growth Outlook - For the full year, Hayward Holdings targets net sales between $1.095 billion to $1.11 billion, reflecting a growth of 4.5% to 5.5% from fiscal year 2024, an increase from previous guidance of $1.07 billion to $1.1 billion [4]. - The company expects adjusted EBITDA to range from $292 million to $297 million, indicating a year-on-year growth of 5% to 7%, up from the previous outlook of $280 million to $290 million [5]. Stock Performance - During intra-day trading, Hayward Holdings' stock reached a peak price of $17.65 before closing at $17.17, marking a 12% increase for the day [2]. - The stock's performance is attributed to the strong earnings report and optimistic future projections [1][3].

Core Viewpoint - Hayward Holdings, Inc. (HAYW) has shown strong stock performance, with a 12.7% increase over the past month and a new 52-week high of $17.65, outperforming both the Zacks Computer and Technology sector and the Zacks Electronics - Miscellaneous Products industry [1][2]. Financial Performance - The company has consistently exceeded earnings expectations, reporting an EPS of $0.14 against a consensus estimate of $0.12 in its last earnings report [2]. - For the current fiscal year, Hayward Holdings is projected to achieve earnings of $0.73 per share on revenues of $1.09 billion, reflecting an 8.96% increase in EPS and a 3.98% increase in revenues [3]. - The next fiscal year forecasts an EPS of $0.81 on revenues of $1.15 billion, indicating a year-over-year change of 10.96% in EPS and 5.26% in revenues [3]. Valuation Metrics - The stock currently trades at 23.5 times the current fiscal year EPS estimates, slightly below the peer industry average of 24.4 times [7]. - On a trailing cash flow basis, it trades at 17.8 times compared to the peer group's average of 16.2 times [7]. - The PEG ratio stands at 2.32, which does not position the company among the top value stocks [7]. Zacks Rank and Style Scores - Hayward Holdings holds a Zacks Rank of 2 (Buy), supported by rising earnings estimates [8]. - The stock has a Value Score of B, a Growth Score of A, and a Momentum Score of F, resulting in a combined VGM Score of B [6][9]. - The combination of a Zacks Rank of 2 and Style Scores of A or B suggests potential for further stock price appreciation in the near term [9].

Core Insights - Hayward Holdings, Inc. reported strong third-quarter earnings for fiscal year 2025, showcasing impressive financial performance and a positive growth outlook [1][2][3] Financial Performance - Earnings per share reached $0.14, exceeding the estimated $0.12, resulting in a 16.67% earnings surprise [2][6] - Revenue was approximately $244.3 million, surpassing the estimated $231.5 million, marking a 5.55% increase over the Zacks Consensus Estimate and an improvement from $227.57 million in the same period last year [2][6] Market Position - The company has a price-to-earnings (P/E) ratio of approximately 26.71, indicating favorable market valuation of its earnings [4] - Price-to-sales ratio stands at about 3.35, while the enterprise value to sales ratio is around 2.97, suggesting a strong market position relative to revenue and sales [4] Financial Health - Hayward's low debt-to-equity ratio of 0.009 indicates minimal debt compared to equity, reflecting strong financial health [5] - The current ratio of approximately 3.18 suggests strong liquidity, enabling effective coverage of short-term liabilities [5] - An earnings yield of about 3.74% reinforces the company's appeal to investors by generating solid earnings per dollar invested [5]

Core Insights - Hayward Holdings experienced a significant increase in stock price following the announcement of strong fiscal third-quarter results, with shares rising over 10% [1] Financial Performance - Sales increased by 7% year over year to $244 million for the quarter ending September 27, driven by price increases to counteract tariffs [3] - Gross profit rose by 11% to $125 million, with gross margin improving by 1.5 percentage points to 51.2% [3] - Adjusted net income surged by 26% to $32 million, while adjusted earnings per share increased by 27% to $0.14, supported by lower interest expenses and stock buybacks [4] Future Outlook - Management raised the full-year profit outlook, projecting adjusted EBITDA to rise by 5% to 7%, estimating between $292 million and $297 million for 2025, up from a previous forecast of $280 million to $290 million [5] - The company noted a growing installed base of pools, which presents opportunities for automation upgrades and accessory sales, indicating a focus on profitable growth and long-term shareholder value [6]

Financial Data and Key Metrics Changes - Net sales increased by 7% to $244 million, driven by a 5% increase in net price and a 2% increase in volume [4][7][15] - Adjusted EBITDA increased by 16% to $59 million, with adjusted EBITDA margin expanding by 170 basis points to 24.2% [4][7][15] - Gross profit margin increased by 150 basis points to 51.2% [4][7][15] - Net leverage reduced to 1.8x, the lowest level in nearly four years [5][19] Business Line Data and Key Metrics Changes - North American net sales increased by 7% to $208 million, with net price realization increasing by 7% and stable volume [16][17] - European and rest of the world net sales increased by 11% to $36 million, with an 8% increase in volume offsetting a 1% reduction in net price realization [17][18] Market Data and Key Metrics Changes - Strong demand trends were reported, particularly in North America and Canada, with Canada seeing over 20% growth [8][27] - The aftermarket model remains resilient, with approximately 85% of sales aligned with serving the aftermarket needs of the existing installed base [8][9] Company Strategy and Development Direction - The company is focused on expanding customer relationships, developing innovative products, and leveraging operational excellence capabilities [5][6] - Investments are being made in advanced engineering and product development, particularly with the introduction of the OmniX automation platform [11][12][34] - The company is also pursuing additional acquisition opportunities in residential and commercial pool sectors [21][47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and raised full-year guidance for net sales and adjusted EBITDA [6][22][23] - The company anticipates solid cash flow generation and a conversion of greater than 100% of net income [23] - Management noted that the macroeconomic and tariff environment continues to evolve, but they remain positive about the long-term growth outlook for the pool industry [24][23] Other Important Information - The company is implementing AI tools to enhance customer service, with new AI agents resolving approximately 80% of inbound calls without human intervention [14][13] - The company has authorized a share repurchase program of up to $450 million over three years [21][22] Q&A Session Summary Question: Demand trends since July and upside in Q3 - Management noted strong sales out demand, particularly in September, and highlighted improved performance in Canada and Europe [26][27][28] Question: Early buy program and price increase reception - The early buy program is tracking well, with discounts offered to mitigate price increases due to inflation and tariffs [29][30] Question: Investments in new products and their impact on sales - The company is making targeted investments in new product development, particularly in technology and innovation, which is expected to drive future sales [33][34] Question: Impact of private label competition - Management believes that their loyal dealer base will continue to appreciate the value proposition of Hayward products despite competition from lower-priced alternatives [40][41] Question: Increase in cash flow guidance - The increase in cash flow guidance is attributed to improved EBITDA, project timing, and working capital management [43][44] Question: International market margin improvements - European margins improved due to stabilization of production capabilities and a cumulative tariff refund [74][75] Question: Tariff refunds and supply chain realignment - The company is actively pursuing tariff refunds and has made significant progress in reducing exposure to China [82][84]

Financial Data and Key Metrics Changes - Net sales increased by 7% to $244 million, driven by a 5% increase in net price and a 2% increase in volume [4][7][15] - Adjusted EBITDA increased by 16% to $59 million, with an adjusted EBITDA margin of 24.2%, up 170 basis points [4][7][15] - Gross profit margin expanded by 150 basis points to 51.2% [4][15] - Cash flow from operations year-to-date was $283 million, compared to $276 million in the previous year [20] Business Line Data and Key Metrics Changes - North American net sales increased by 7% to $208 million, with a 7% increase in net price realization and stable volume [16][17] - European and rest of the world net sales increased by 11% to $36 million, with an 8% increase in volume offsetting a 1% reduction in net price realization [17][18] - Adjusted segment income margins in Europe increased to 18.5% from 8.4% a year ago [18] Market Data and Key Metrics Changes - Strong demand trends were reported, particularly in Canada, which saw over 20% growth [28] - The U.S. market experienced improved out-the-door sales growth rates for Hayward products, especially in September [8][26] - The aftermarket model remains resilient, with approximately 85% of sales aligned with serving existing installed base needs [8][9] Company Strategy and Development Direction - The company is focusing on expanding customer relationships, developing innovative products, and leveraging operational excellence [5][6] - Strategic initiatives include tariff mitigation actions and investments in advanced engineering and product development [11][12] - The company is also pursuing additional acquisition opportunities in residential and commercial pool sectors [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and raised full-year guidance for net sales and adjusted EBITDA [6][22] - The company expects net sales to increase approximately 4% to 5.5% for the full year, with adjusted EBITDA projected to increase by 5% to 7% [22][23] - Management noted that the macroeconomic and tariff environment continues to evolve, but they remain positive about long-term growth in the pool industry [24] Other Important Information - The company has reduced net leverage to 1.8 times, the lowest level in nearly four years, providing enhanced financial flexibility [5][19] - The board authorized a share repurchase program of up to $450 million over three years [21] Q&A Session Summary Question: How did the season progress since July, and where did you see the upside in the third quarter? - Management noted strong sales out demand, particularly in September, and highlighted improved performance in Canada and Europe [26][28] Question: How do you think about the early buy program relative to the market being flat? - Management indicated that the early buy program is tracking expectations and that they are managing price increases carefully to mitigate inflation impacts [30][31] Question: Can you discuss your investments in new products and how they are impacting sales? - Management emphasized targeted investments in engineering and new product development, particularly with the OmniX platform, which is expected to drive future growth [34][36] Question: What are your capital allocation priorities moving forward? - Management stated that they will focus on organic capex, M&A opportunities, and share repurchases, with an emphasis on automation and supply chain improvements [49][50] Question: How are you addressing the impact of tariffs and supply chain realignment? - Management reported significant progress in reducing exposure to China and successfully applying for tariff refunds, which positively impacted margins [82][84]

Financial Data and Key Metrics Changes - Net sales increased by 7% to $244 million, driven by a 5% increase in net price and a 2% increase in volume [6][14] - Adjusted EBITDA increased by 16% to $59 million, with an adjusted EBITDA margin of 24.2%, up 170 basis points [6][14] - Gross profit margin expanded by 150 basis points to 51.2% [6][14] - Cash flow generation was strong, reducing net leverage to 1.8 times, the lowest level in nearly four years [5][18] Business Line Data and Key Metrics Changes - North American net sales increased by 7% to $208 million, with a 7% increase in net price realization and stable volume [15][16] - European and rest of the world net sales increased by 11% to $36 million, with an 8% increase in volume offsetting a 1% reduction in net price realization [16][17] - Adjusted segment income margins in Europe increased to 18.5% from 8.4% a year ago [17] Market Data and Key Metrics Changes - Strong demand trends were reported, particularly in Canada, which saw a 21% increase in net sales [16][26] - The U.S. market experienced improved out-the-door sales growth rates for Hayward products, particularly in September [7][25] - The aftermarket model remains resilient, with approximately 85% of sales aligned with serving the aftermarket needs of the existing installed base [7][8] Company Strategy and Development Direction - The company is focused on expanding customer relationships, developing innovative products, and leveraging operational excellence [5][10] - Investments are being made in advanced engineering and product development, particularly with the introduction of the OmniX automation platform [10][11] - The company is actively pursuing acquisition opportunities in residential and commercial pool markets to augment organic growth [19][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and raised full-year guidance for net sales and adjusted EBITDA [5][21] - The company expects net sales to increase approximately 4% to 5.5% for the full year, with adjusted EBITDA projected to increase by 5% to 7% [21][22] - Management noted that the tariff environment remains uncertain but emphasized ongoing tariff mitigation actions [9][75] Other Important Information - The company authorized a share repurchase program of up to $450 million over three years [19] - Year-to-date cash flow from operations was $283 million, reflecting improved profitability and working capital management [19] Q&A Session Summary Question: How did the season progress since July, and where did you see the upside in the third quarter? - Management noted strong sales out demand, particularly in September, and highlighted improved performance in Canada [25][26] Question: How do you think about the early buy program relative to the market being flat? - The early buy program is tracking expectations, and the company aims to level load factories while managing price increases due to inflation and tariffs [29][30] Question: Can you discuss your investments in new products and their impact on sales? - The company is making targeted investments in engineering and new product development, with a focus on technology and innovation [31][32] Question: What are your capital allocation priorities moving forward? - The company plans to increase CapEx for automation and supply chain improvements while also considering M&A opportunities [41][45] Question: How do you view the impact of the recent tariff refunds on margins? - The company received a cumulative tariff refund that positively impacted margins, and it will continue to pursue eligible tariff refunds [73][75]

Core Insights - Hayward Holdings, Inc. reported quarterly earnings of $0.14 per share, exceeding the Zacks Consensus Estimate of $0.12 per share, and showing an increase from $0.11 per share a year ago, resulting in an earnings surprise of +16.67% [1] - The company achieved revenues of $244.34 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 5.55% and up from $227.57 million year-over-year [2] - Hayward Holdings has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.28 on revenues of $333 million, while the estimate for the current fiscal year is $0.73 on revenues of $1.09 billion [7] - The company's favorable estimate revisions trend prior to the earnings release has resulted in a Zacks Rank 2 (Buy), indicating expected outperformance in the near future [6] Industry Context - The Electronics - Miscellaneous Products industry, to which Hayward Holdings belongs, is currently ranked in the top 20% of over 250 Zacks industries, suggesting a positive outlook for stocks within this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Net sales reached $244.3 million, a 7% year-over-year increase[10] - Adjusted EBITDA was $59.1 million, up 16% year-over-year[10] - Gross profit margin stood at 51.2%, an increase of 150 basis points year-over-year[10, 20] - Adjusted diluted EPS increased by 27% year-over-year to $0.14[10, 20] Segment Performance - North America net sales were $208.2 million, a 6.8% year-over-year increase, with a gross profit margin of 52.8%[23] - Europe & Rest of World net sales were $36.1 million, a 10.7% year-over-year increase, with a gross profit margin of 41.9%[24] Balance Sheet and Cash Flow - Net leverage decreased to 1.8x, the lowest level since Q4 2021[8, 26] - Free cash flow for the year-to-date reached $262 million, compared to $258 million in the same period of the previous year[28] Outlook - The company increased its full-year 2025 net sales outlook to between $1.095 billion and $1.110 billion, representing a growth of approximately 4% to 5.5% year-over-year[37] - The company increased its full-year 2025 adjusted EBITDA outlook to between $292 million and $297 million, representing a growth of approximately 5% to 7% year-over-year[37]

Financial Performance - Net sales increased by 7% year-over-year to $244.3 million for Q3 FY2025, driven by positive net pricing and increased volume[3] - Gross profit rose by 11% to $125.1 million, with a gross profit margin of 51.2%, an increase of 150 basis points[4] - Net income surged by 46% year-over-year to $24.0 million, with a net income margin expanding by 250 basis points to 9.8%[9] - Adjusted EBITDA increased by 16% to $59.1 million, with an adjusted EBITDA margin expanding by 170 basis points to 24.2%[10] - Operating income grew by 23% to $41.1 million, resulting in an operating margin of 16.8%, up 210 basis points from the prior year[6] - Cash flow from operations for the nine months ended September 27, 2025, was $283.0 million, an increase of $7.2 million from the prior-year period[13] - Net income for the nine months ended September 27, 2025, was $83,160 thousand, a 30.0% increase from $63,922 thousand in the same period last year[29] - The company reported a net income margin of 10.8% for the nine months ended September 27, 2025, compared to 8.8% for the same period in 2024[30] - Adjusted EBITDA for the nine months ended September 27, 2025, was $196,404 thousand, up 9.8% from $178,748 thousand in the prior year[30] - Adjusted EBITDA for the last twelve months ended September 27, 2025, is $295.1 million, reflecting a margin of 26.8% compared to 26.4% for the fiscal year ended December 31, 2024[34] Segment Performance - North America segment net sales increased by 7% to $208.2 million, with segment income also rising by 7% to $55.4 million[11] - Europe & Rest of World segment net sales increased by 11% to $36.1 million, with segment income soaring by 152% to $6.2 million[12] - North America segment income for the three months ended September 27, 2025, was $55,387 thousand, an increase from $51,569 thousand for the same period in 2024, representing a growth of 5.4%[41] - Europe & Rest of World segment income for the three months ended September 27, 2025, was $6,247 thousand, up from $2,475 thousand in the prior year, reflecting a significant increase of 152.5%[41] - Adjusted segment income for North America for the nine months ended September 27, 2025, reached $201,448 thousand, compared to $186,038 thousand in the same period of 2024, indicating a growth of 8.3%[42] - The company reported a total adjusted segment income of $21,668 thousand for Europe & Rest of World for the nine months ended September 27, 2025, up from $17,601 thousand in the prior year, marking an increase of 23.5%[42] Guidance and Future Outlook - The company is increasing its full-year 2025 guidance, expecting net sales of $1.095 billion to $1.110 billion, a 4% to 5.5% increase from FY2024[14] - The company remains focused on profitable growth and long-term shareholder value creation through investments in innovation and operational excellence[2] Cash and Assets - Cash and cash equivalents increased to $428,684 thousand as of September 27, 2025, compared to $196,589 thousand at the beginning of the period[29] - Total assets reached $3,035,620 thousand as of September 27, 2025, a slight increase from $2,990,624 thousand at the end of 2024[27] - Total liabilities decreased to $1,512,834 thousand as of September 27, 2025, from $1,566,977 thousand at the end of 2024[27] Expenses and Adjustments - Research, development, and engineering expenses for the nine months ended September 27, 2025, totaled $19,236 thousand, up from $18,870 thousand in the prior year[28] - The company incurred $3.3 million in transaction and integration costs related to the ChlorKing acquisition during the nine months ended September 27, 2025[39] - A non-recurring litigation expense of $2.8 million was recorded in the three months ended September 27, 2025, with additional insurance proceeds of $0.2 million related to flood damage[39] - The company recognized $6.3 million in retention compensation expenses for key employees acquired in the ChlorKing acquisition, with payments contingent on continued employment[35] - Total adjustments for the last twelve months ended September 27, 2025, amount to $11.7 million, compared to $10.3 million for the fiscal year ended December 31, 2024[34] - The company reported a $1.6 million increase in cost of goods sold due to fair value inventory step-up adjustments from the ChlorKing acquisition[39] Shareholder Information - The weighted average number of diluted shares outstanding for the nine months ended September 27, 2025, is 222,074,267[36] - The net income margin for the nine months ended September 27, 2025, is 12.5%, an increase from 11.3% for the previous fiscal year[34] Depreciation and Compensation - The depreciation expense for North America for the nine months ended September 27, 2025, was $14,623 thousand, an increase from $12,619 thousand in the same period of 2024, representing a rise of 15.9%[42] - Stock-based compensation for North America was recorded at $0 for the three months ended September 27, 2025, compared to $107 thousand in the prior year, indicating a reduction in this expense category[41]