Pool Stock Is Down 35% This Past Year, and One Fund Recently Disclosed Dumping a $10 Million Stake

Core Insights - Wedgewood Partners sold its entire position in Pool Corporation, divesting 32,322 shares valued at $10.02 million as of February 17, 2026 [1][2] Company Overview - Pool Corporation operates in the distribution of swimming pool supplies, equipment, and related leisure products across North America, Europe, and Australia [6][9] - The company has a market capitalization of $9 billion and reported revenue of $5.29 billion with a net income of $412.12 million for the trailing twelve months [4] Financial Performance - Pool Corporation's sales for 2025 were $5.3 billion, showing a slight year-over-year decline, while the gross margin remained steady at 29.7% [7] - The diluted EPS decreased by 4% year-over-year to $10.85, with management guiding for a range of $10.85 to $11.15 for 2026 [7] - Operating income fell from $617.2 million to $580.2 million, and operating cash flow decreased to $365.9 million due to inventory buildup ahead of price increases [10] Market Position - As of February 17, 2026, shares of Pool were priced at $255.46, down 24.4% over the past year, underperforming the S&P 500 by 36.5 percentage points [8] - The company serves a primary customer base that includes swimming pool professionals, specialty retailers, and commercial clients such as hotels and community facilities [9] Strategic Considerations - The sale of Pool Corporation by Wedgewood Partners reflects a shift towards secular compounders over cyclical, weather-sensitive operators [11] - Long-term investment considerations include housing turnover, backyard renovation trends, and the resilience of margins, with the company's scale and extensive sales center network providing leverage if discretionary demand stabilizes [12]