Pentair Earnings & Sales Surpass Estimates in Q4, EPS Up Y/Y

Core Insights - Pentair plc reported fourth-quarter 2024 adjusted EPS of $1.08, exceeding the Zacks Consensus Estimate of $1.02 and improving 24% from $0.87 in the prior year [1] - The company’s net sales declined 1.2% year over year to $973 million but surpassed the Zacks Consensus Estimate of $970 million [2] - For the full year 2024, adjusted EPS was $4.33, beating the Zacks Consensus Estimate of $4.28 and reflecting a 15% increase from $3.75 in 2023 [11] Financial Performance - Including one-time items, EPS was $0.99 compared to $1.25 in the prior-year quarter [2] - Cost of sales decreased 4% year over year to $595 million, while gross profit increased 3% to $378 million, resulting in a gross margin of 38.8% [3] - SG&A expenses fell 8.5% to $161 million, and R&D expenses declined 7.2% to $21.8 million [3] Operating Metrics - Operating income rose 17% year over year to $195 million, with an operating margin of 20.1% compared to 17.0% in the previous year [4] - Adjusted segmental operating income increased 17% to $231 million, with an adjusted segmental margin of 23.8% [4] Segment Performance - Flow segment net sales were $361 million, down 4.7% year over year, but adjusted operating earnings rose 13% to $73.6 million [5] - Water Solutions segment net sales decreased 4.3% to $258 million, with earnings increasing to $62 million from $52 million [6] - Pool segment net sales increased 5% to $354 million, with operating earnings growing 13.6% to $119 million [7] Cash Flow and Balance Sheet - Cash and cash equivalents were approximately $119 million at the end of 2024, down from $170 million at the end of 2023 [8] - Net cash generated from operating activities was $767 million in 2024, compared to $621 million in the prior year [8] - Long-term debt decreased to $1.64 billion from $1.99 billion year over year [8] Shareholder Returns - Pentair increased its dividend by 9% to $0.25 per share, marking the 49th consecutive year of dividend increases [9] - The company repurchased 0.4 million shares for $50 million in the fourth quarter, with $450 million remaining under its share repurchase authorization [9] Guidance - For 2025, Pentair expects adjusted EPS between $4.65 and $4.82, indicating a year-over-year growth of 9% [12] - For Q1 2025, the company anticipates adjusted EPS between $1.00 and $1.02, with sales expected to decline 3-4% from the previous year [12] Stock Performance - Pentair's stock has gained 41.8% over the past year, outperforming the industry growth of 17.1% [13]