Here’s Why Pool Corp. (POOL) Declined in Q2
Conestoga Capital Advisors, an asset management company, released its “SMid Cap Strategy” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. The second quarter of 2024 may be regarded as a time of moderation. Economic indicators largely reflected slowing growth and easing inflation. Equity markets are also driven by moderation theme. Large-cap stocks, as measured by the S&P 500, rose 3.9% in the second quarter, however, small-cap stocks lagged again, with the Russell 2000 Index declining -3.3% and the Russell 2000 Growth Index declining -2.9%. The strategy declined -4.82% net-of-fees in the quarter compared to -4.22% return for the Russell 2500 Growth Index. Stock selection effects in the Health Care and Consumer Discretionary sectors were the primary drivers of underperformance and were partially offset by positive contributions in the Technology and Industrials sectors. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Conestoga Capital Advisors highlighted stocks like Pool Corporation (NASDAQ:POOL), in the second quarter 2024 investor letter. Pool Corporation (NASDAQ:POOL) is a swimming pool supplies, equipment, and related leisure products distributor. The one-month return of Pool Corporation (NASDAQ:POOL) was 5.65%, and its shares lost 0.69% of their value over the last 52 weeks. On August 15, 2024, Pool Corporation (NASDAQ:POOL) stock closed at $347.09 per share with a market capitalization of $13.279 billion.
Conestoga Capital Advisors stated the following regarding Pool Corporation (NASDAQ:POOL) in its Q2 2024 investor letter:
"Pool Corporation (NASDAQ:POOL): This company is the largest distributor of pool equipment, supplies and related building materials in the world. In late June the company pre-announced a softer than expected 2Q24 business update and lowered its full year earnings guidance by nearly 20%. While maintenance spending has remained stable, POOL cited weaker discretionary spending in the 40% of revenue tied to new construction and renovation and remodel."
Aerial view of a swimming pool with outdoor furniture surrounding it.
Pool Corporation (NASDAQ:POOL) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held Pool Corporation (NASDAQ:POOL) at the end of the first quarter which was 42 in the previous quarter. Pool Corporation (NASDAQ:POOL) recorded $1.8 billion in net sales in the second quarter, 5% less than the previous year. While we acknowledge the potential of Pool Corporation (NASDAQ:POOL) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Pool Corporation (NASDAQ:POOL) and shared The London Company Mid Cap Strategy's views on the company. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.