Latham Group (NASDAQ:SWIM) Posts Earnings Results, Misses Expectations By $0.05 EPS

Latham Group (NASDAQ:SWIM) posted its earnings results on Tuesday. The company reported $0.11 EPS for the quarter, missing analysts’ consensus estimates of $0.16 by ($0.05), FiscalAI reports. Latham Group had a net margin of 1.55% and a return on equity of 2.13%. The company had revenue of $197.47 million during the quarter, compared to analyst estimates of $188.39 million.

Here are the key takeaways from Latham Group’s conference call:

• Raised full-year 2026 guidance: Management increased the midpoint of sales growth guidance to 11.7% from 9% and adjusted EBITDA growth to 15.2% from 12.7%, citing stronger demand, share gains, and expected operating leverage.
• Second-quarter sales rose 14% year over year to $197 million, including 10% organic growth, with particularly strong in-ground pool sales and fiberglass pool demand. Consumer leads increased 60%, website traffic rose 30%, and July sales trends were tracking toward guidance.
• The Sand States strategy continued to gain traction, with double-digit sales growth in Florida and across the region. Latham plans to expand its targeted market-development approach into Texas, followed by Arizona and California, while funding much of the expansion through internal cost optimization.
• Gross margin fell 160 basis points to 35.5% because the rapid demand surge caused under-absorption, inventory drawdowns, and accelerated hiring, training, and overtime costs. Management expects to recover most of the approximately $2.8 million headwind over the next two quarters, but higher transportation and commodity costs may require further pricing actions.
• Adjusted EBITDA increased 12% to $45 million, while management expects year-end net leverage below 2.0 times versus 2.2 times at quarter-end. This is intended to preserve flexibility for reinvestment, selective acquisitions, and potentially returning capital to shareholders.

Latham Group Stock Performance

Shares of Latham Group stock traded up $1.47 on Wednesday, reaching $7.17. 1,735,269 shares of the company were exchanged, compared to its average volume of 848,483. The company has a debt-to-equity ratio of 0.70, a quick ratio of 1.16 and a current ratio of 1.88. The company’s 50-day moving average is $5.77 and its two-hundred day moving average is $5.94. The firm has a market cap of $841.24 million, a price-to-earnings ratio of 102.21, a P/E/G ratio of 0.96 and a beta of 1.65. Latham Group has a 1-year low of $4.64 and a 1-year high of $8.97.

Insider Activity at Latham Group

In related news, CFO Oliver C. Gloe acquired 15,050 shares of Latham Group stock in a transaction that occurred on Wednesday, May 20th. The stock was acquired at an average price of $4.90 per share, for a total transaction of $73,745.00. Following the transaction, the chief financial officer directly owned 540,758 shares of the company’s stock, valued at $2,649,714.20. This trade represents a 2.86% increase in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Also, Director James E. Cline acquired 50,000 shares of the stock in a transaction that occurred on Tuesday, May 19th. The shares were bought at an average price of $4.84 per share, with a total value of $242,000.00. Following the completion of the purchase, the director owned 100,000 shares in the company, valued at $484,000. The trade was a 100.00% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Company insiders own 3.32% of the company’s stock.

Institutional Trading of Latham Group

A number of large investors have recently modified their holdings of SWIM. nVerses Capital LLC bought a new stake in Latham Group in the 4th quarter valued at about $97,000. Wellington Management Group LLP grew its position in Latham Group by 216.4% in the 4th quarter. Wellington Management Group LLP now owns 6,749,349 shares of the company’s stock worth $42,858,000 after purchasing an additional 4,616,367 shares during the last quarter. Tudor Investment Corp ET AL bought a new position in Latham Group in the 4th quarter worth about $207,000. Millennium Management LLC increased its stake in shares of Latham Group by 124.0% in the fourth quarter. Millennium Management LLC now owns 151,710 shares of the company’s stock valued at $963,000 after purchasing an additional 83,990 shares during the period. Finally, Man Group plc acquired a new stake in shares of Latham Group in the fourth quarter valued at approximately $118,000. Institutional investors and hedge funds own 83.95% of the company’s stock.

Wall Street Analyst Weigh In

Several equities analysts have commented on the stock. Weiss Ratings upgraded shares of Latham Group from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Thursday, May 7th. The Goldman Sachs Group reissued a “sell” rating on shares of Latham Group in a report on Wednesday, May 6th. Wall Street Zen lowered shares of Latham Group from a “buy” rating to a “hold” rating in a research report on Sunday, April 12th. Barclays reduced their price objective on shares of Latham Group from $8.00 to $7.00 and set an “equal weight” rating on the stock in a research note on Wednesday, April 8th. Finally, Bank of America lowered their price objective on shares of Latham Group from $7.00 to $6.00 and set an “underperform” rating for the company in a research note on Monday, April 20th. Two equities research analysts have rated the stock with a Buy rating, three have issued a Hold rating and two have issued a Sell rating to the stock. Based on data from MarketBeat, Latham Group presently has a consensus rating of “Hold” and an average target price of $7.50.

Latham Group Company Profile

Latham Group, Inc designs, manufactures and supplies a broad range of aquatic products and services for residential and commercial applications. Offerings include fiberglass and vinyl-liner pool shells, commercial water park structures, water slides, surf simulators, pumps, filters, heaters and sanitation systems. The company also provides parts, equipment and technical support for pool installation, maintenance and repair.

Operating across three core segments—commercial, residential and aftermarket—Latham delivers turnkey aquatic facilities and attractions for municipal, hospitality and resort clients, offers packaged pool kits and equipment packages to builders and dealers, and supplies replacement parts, service contracts and technical assistance to support ongoing pool operations.

Headquartered in the United States, Latham Group maintains manufacturing and distribution centers throughout North America and Europe.