Latham's Q2 Earnings Call: Our Top 5 Analyst Questions

Latham’s second quarter saw sales increase nearly 8% year-over-year despite falling short of market revenue expectations, a result that was met with a significant positive reaction from investors. Management credited this growth to the strong performance of autocovers, which benefited from both acquisitions and organic adoption, as well as expanding lead generation from digital marketing efforts. CEO Scott Rajeski emphasized, “Our diversified portfolio and leadership in fiberglass pools and autocovers allowed us to deliver sales growth and margin expansion in a challenging industry environment.”

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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 From Latham’s Q2 Earnings Call

• Gregory William Palm (Craig-Hallum Capital Group) asked about the return on marketing investments and the timeline for translating increased dealer sign-ups and consumer leads into actual orders. CEO Scott Rajeski emphasized that while some impact may be seen this year, the core benefit is building a demand pipeline for 2026.
• William Andrew Carter (Stifel) questioned the impact of adverse weather on different pool categories and whether gross margin improvements were structural or benefited from one-time items. CFO Oliver Gloe clarified that both fiberglass and packaged pools were affected, but margin gains were mostly structural.
• Ryan James Merkel (William Blair) inquired about current order trends and backlog for fiberglass pools. Rajeski explained that lead times are short and backlogs are holding up, with fiberglass expected to return to growth in the back half of the year.
• Timothy Ronald Wojs (Baird) asked if the composition of revenue guidance had changed, specifically regarding product mix and pricing. Gloe confirmed the seasonal profile remains consistent, with no unusual shifts and ongoing benefits from recent acquisitions.
• Shaun Francis Calnan (Bank of America) probed the drivers behind the implied acceleration in second half revenue growth, given reduced M&A contributions. Gloe pointed to weather normalization, continued recovery in fiberglass, and a strong upcoming safety cover season.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will monitor (1) the pace of dealer expansion and sales growth in key Sand State markets, (2) continued margin improvements from lean manufacturing and value engineering, and (3) the impact of regulatory changes and marketing programs on autocover adoption. Execution against these milestones will be crucial as Latham aims to outpace broader pool market trends.

Latham currently trades at $7.21, up from $6.84 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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