Latham’s first quarter results for 2025 closely tracked Wall Street’s expectations, with revenue flat year over year. CEO Scott Rajeski attributed the quarter’s performance to relative strength in fiberglass pools and auto covers, as well as operational improvements in manufacturing and value engineering. Rajeski highlighted that “after a few slow weeks in early January, we saw a nice sequential pickup of business activity in March that continued through April and into May.” Management also pointed to the benefits of recent acquisitions and increased marketing activity, particularly in key growth regions.
Is now the time to buy SWIM? Find out in our full research report (it’s free).
Latham (SWIM) Q1 CY2025 Highlights:
- Revenue: $111.4 million vs analyst estimates of $111.3 million (flat year on year, in line)
- Adjusted EPS: -$0.05 vs analyst estimates of -$0.05 (in line)
- Adjusted EBITDA: $11.14 million vs analyst estimates of $10.94 million (10% margin, 1.8% beat)
- The company reconfirmed its revenue guidance for the full year of $550 million at the midpoint
- EBITDA guidance for the full year is $95 million at the midpoint, above analyst estimates of $91.14 million
- Operating Margin: -4.4%, down from -1.9% in the same quarter last year
- Market Capitalization: $758.7 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Latham’s Q1 Earnings Call
- Ryan Merkel (William Blair) asked about SG&A leverage and margin progression through the year. CFO Oliver Gloe responded that cost increases will moderate, with leverage improving in the second half as sales ramp up.
- Ryan Merkel (William Blair) inquired about new product traction in Sand States. CEO Scott Rajeski outlined early success with builder partnerships and region-specific models, expecting accelerated market share gains as the year progresses.
- Andrew Carter (Stifel) pressed on the risk of cancellations and demand stability for fiberglass pools. Rajeski explained that purchase decisions have long lead times and that affluent buyers are less sensitive to short-term uncertainty.
- Robert Schultz (Baird) questioned the pace of entry into master plan communities in Sand States. Rajeski confirmed initial targets are on track, with flexibility to accelerate expansion as the strategy matures.
- Sean Callan (Bank of America) sought clarity on the split between M&A and organic growth in auto covers. Gloe said acquisitions provided a meaningful boost, but organic demand also contributed to outperformance.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will be watching (1) the pace of Sand States market penetration and dealer expansion, (2) continued margin resilience as lean manufacturing and value engineering initiatives take hold, and (3) the ability to mitigate tariff-related cost pressures through pricing and supply chain actions. Execution of new product launches and the effectiveness of targeted marketing efforts will also be important markers of progress.
Latham currently trades at $6.27, up from $5.98 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).
High-Quality Stocks for All Market Conditions
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
