Leslie’s stock price target lowered to $0.35 at Telsey on weak demand

Published 07/08/2025, 11:10
Leslie’s stock price target lowered to $0.35 at Telsey on weak demand

Investing.com - Telsey Advisory Group lowered its price target on Leslie’s (NASDAQ:LESL) to $0.35 from $0.75 on Thursday, while maintaining a Market Perform rating on the pool supplies retailer. The stock, currently trading near its 52-week low of $0.34, has seen its market capitalization shrink to just $67.55 million amid significant challenges. According to InvestingPro, five analysts have recently revised their earnings expectations downward for the upcoming period.

The price target reduction follows Leslie’s disappointing third-quarter fiscal 2025 results, which the company pre-announced on July 28. The retailer reported a 12.4% decline in comparable sales and approximately 25% year-over-year drop in adjusted EBITDA. InvestingPro data reveals the company’s broader financial challenges, with revenue declining 6.12% and a concerning negative net income in the last twelve months.

Telsey attributed the poor performance primarily to unfavorable weather conditions, with cold and wet conditions causing many customers to delay pool openings during the peak season. The impact was especially pronounced in northern regions, which represent a significant portion of third-quarter sales due to seasonal demand patterns.

Market conditions further deteriorated as excess inventory levels prompted competitors to implement aggressive price cuts to clear seasonal products, resulting in market share losses for Leslie’s. While the firm noted that competitor pricing actions have subsided and traffic has improved sequentially in the fourth quarter, Leslie’s still anticipates another significantly down quarter to close the fiscal year.

Leslie’s has issued revised fiscal year 2025 guidance, now projecting adjusted EBITDA to decline 45%-54% year-over-year to $50-$60 million, below Telsey’s previous expectation of $64 million.

In other recent news, Leslie’s Inc. announced its Q2 2025 earnings, which fell below analyst expectations. The company reported an earnings per share (EPS) of $0.20, missing the forecasted $0.35. Additionally, Leslie’s Inc. disclosed revenue of $500.35 million, which did not meet the anticipated $564.81 million. Despite these results, the company’s stock experienced a 4% increase in after-hours trading. This movement suggests a complex investor sentiment possibly influenced by strategic company initiatives and prevailing market conditions. The earnings and revenue figures highlight significant shortfalls, drawing attention from investors and analysts alike. These recent developments continue to shape the financial outlook for Leslie’s Inc.

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