Zacks Investment Research downgraded shares of Pool Corp. (POOL) from OUTPERFORM to NEUTRAL on July 17, 2012, with a target price of $41.00.
Pool's first-quarter 2012 earnings outperformed the Zacks Consensus Estimate. The company is a recognized leader in the industry. The potential for market growth is significant and cost-containment initiatives augur well for the business. Pool's results reflect continued growth in its once struggling green business. Amid a tough business environment in terms of weak growth in new pool constructions and faltering consumer confidence, Pool's revenue has been growing in addition to the strength in earnings. The company expects the market condition to improve beyond 2012 as well. However, the company will likely register sequential declines in sales and earnings in its upcoming third quarter as the seasonality will be weak ahead. Hence, we downgrade the stock from an Outperform to Neutral recommendation.
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