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$17.34 -0.73 (-4.04%)
10/10/2008 4:00 PM

Pool Corp (POOL)

CAPS Rating:
**

The Company is a wholesale distributor of swimming pool supplies, equipment and related leisure products.

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Avatar Patrick6k (< 20) Submitted: 10/29/07 3:54 PM : Outperform Start Price: $23.44 POOL Score: 16.54

Sometimes there are hidden gems even my favorite FOOL investor Tom Gardner misses....well in his newsletter anyway. Don't worry Tom, I'm here for you buddy....I got your back.





For those of you who have never heard of Pool Corporation.....they, suprisingly enough, sell pool equipment and supplies. Most people having been dumping this stock like the plague because of the housing market slow down. Not a good idea, but I love people that sell now and think later...it helps the smart FOOLS make more money. Ok yes...the housing market is cooling, but the houses are already built....WITH THE SWIMMING POOLS INSTALLED. This company sells maintenance and repair supplies for pools.





With the recent boom in the number of houses and hence swimming pools built....guess what....more demand for pool maintenance and repair supplies. If this company keeps doing what it does best and keeps its focus....buy this one...and hold it until retirement.





This quaint little stock has been quietly kicking the snot out of the market since it went public 13 years ago and I look for it to continue to do so for many years to come.

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Avatar dwot (100.00) Submitted: 12/14/07 11:35 PM

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Sure....

"Median home prices in the county tumbled from a high of $425,000 in July 2006 to $319,000 in October. Last summer, San Joaquin County officials sent out crews to dump chemicals and larvae-eating fish into the stagnant water of abandoned swimming pools, where mosquitoes were breeding."

http://www.latimes.com/news/local/la-me-stockton13dec13,1,1573121,full.story?coll=la-headlines-california&ctrack=1&cset=true

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Avatar Patrick6k (< 20) Submitted: 1/08/08 7:01 PM

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What company do you think San Joaquin County crews probably got the chemicals from to dump into the stagnant water? :~)

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Avatar metoo105 (99.80) Submitted: 7/16/08 2:19 PM

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Does it matter?

The argument was never that this company won't have any revenues. Here's the argument: swimming pools have variable costs. In flush times, folks don't mind forking over lots of money to add fancy gadgets to their pools. And in dark, recessionary times, they think twice about them. All costs here are variable. On the one end you have expensive chemicals and on another you have the cheapie chemicals. Which one do you think has better margins?

In fact, it ought to be a fundamental rule of economics that more expensive items always have better margins. So there'll probably be some margin compression.

Also debt has been rising, cash has been falling, and they've got a lot of debt that requires about $20M a year to service.

Finally, while the stock has fallen, the analysts haven't lowered their price targets very much. Presumably, they are reasoning like you. But it makes for a volatile situation if they miss the current target. This one might just go belly up in a hurry, b/c if does not look they make enough money over the summer to fund their cash expenses for the rest of the year. Then . . . . kapow.

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