Leslie’s (NASDAQ:LESL) Issues Quarterly Earnings Results, Misses Expectations By $0.95 EPS

Leslie’s (NASDAQ:LESL) released its earnings results on Wednesday. The company reported ($5.36) earnings per share for the quarter, missing analysts’ consensus estimates of ($4.41) by ($0.95), FiscalAI reports. The firm had revenue of $184.74 million for the quarter, compared to analysts’ expectations of $162.48 million.

Here are the key takeaways from Leslie’s’ conference call:

• Leslie’s said its fiscal Q2 2026 transformation plan is gaining traction, with revenue up 4.3%, comparable sales up 6.6%, adjusted EBITDA improving 26%, and total customer count up 8%.
• The new Price Drop pricing strategy appears to be working, driving double-digit transaction growth, a more than 350 basis point conversion improvement, and strong customer response, especially in core chemical categories.
• Management highlighted better operational execution, including a restructured field organization, stronger marketing, improved store signage, and expanded convenience options like BOPUS and nationwide Uber same-day delivery.
• Gross margin expanded sharply to 28.9% from 24.8% a year ago, helped by higher sales, lower distribution and occupancy costs, and reduced inventory reserves. Management said some of these benefits are recurring, while the reserve-related boost was one-time.
• The company kept its full-year outlook unchanged, reaffirming 2026 sales of $1.1 billion to $1.25 billion and adjusted EBITDA of $55 million to $75 million, while noting most sales and earnings are still expected in the second half due to seasonality.

Leslie’s Price Performance

Shares of Leslie’s stock traded up $2.07 during trading on Thursday, reaching $3.50. 41,081,625 shares of the stock traded hands, compared to its average volume of 600,190. Leslie’s has a 52-week low of $0.87 and a 52-week high of $18.56. The business has a fifty day simple moving average of $1.36 and a two-hundred day simple moving average of $1.87. The company has a market capitalization of $32.62 million, a price-to-earnings ratio of -0.12 and a beta of 1.53.

Analyst Ratings Changes

A number of brokerages have weighed in on LESL. Zacks Research raised shares of Leslie’s from a “strong sell” rating to a “hold” rating in a research note on Tuesday, March 17th. Morgan Stanley set a $1.00 price target on Leslie’s and gave the stock an “underweight” rating in a research note on Wednesday, February 18th. Mizuho reduced their price objective on Leslie’s from $4.00 to $3.50 and set a “neutral” rating for the company in a research report on Friday, May 8th. Wolfe Research reiterated an “outperform” rating and set a $3.00 price objective (up from $2.00) on shares of Leslie’s in a research note on Thursday. Finally, Weiss Ratings reissued a “sell (e+)” rating on shares of Leslie’s in a research report on Wednesday, March 25th. One investment analyst has rated the stock with a Buy rating, four have issued a Hold rating and two have assigned a Sell rating to the company’s stock. Based on data from MarketBeat.com, the company currently has a consensus rating of “Reduce” and a consensus target price of $2.85.

Key Stories Impacting Leslie’s

Here are the key news stories impacting Leslie’s this week:

• Positive Sentiment: Second-quarter revenue came in at $184.74 million, above estimates of $162.48 million, while sales rose 4.3% and comparable sales increased 6.6%, suggesting demand is improving. Article Title
• Positive Sentiment: Management said customer counts grew 8% year over year and reiterated full-year guidance, which can reassure investors that the company sees continued momentum ahead. Article Title
• Positive Sentiment: Improved margins and strategic initiatives highlighted on the earnings call helped reinforce the idea that Leslie’s is making progress on profitability, even with earnings still under pressure. Article Title
• Neutral Sentiment: Leslie’s posted an EPS loss of $5.36, wider than expected, so the stock’s move is being driven more by revenue and operating improvement than by bottom-line strength. Article Title
• Neutral Sentiment: The company reiterated FY2026 sales guidance of about $1.1 billion to $1.25 billion and adjusted EBITDA guidance of $55 million to $75 million, keeping expectations steady rather than raising them. Article Title
• Negative Sentiment: Despite the revenue beat, the company still reported a large quarterly loss, which remains a key risk for investors and limits the durability of the rally. Article Title

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in the business. Quadrature Capital Ltd acquired a new stake in Leslie’s in the 4th quarter worth approximately $34,000. Barclays PLC purchased a new stake in Leslie’s in the fourth quarter valued at $35,000. Engineers Gate Manager LP increased its holdings in Leslie’s by 309.7% in the 2nd quarter. Engineers Gate Manager LP now owns 61,474 shares of the company’s stock valued at $26,000 after purchasing an additional 46,468 shares during the last quarter. Scopia Capital Management LP acquired a new stake in shares of Leslie’s in the second quarter valued at $41,000. Finally, Goldman Sachs Group Inc. boosted its position in Leslie’s by 16.9% in the 4th quarter. Goldman Sachs Group Inc. now owns 102,428 shares of the company’s stock valued at $169,000 after buying an additional 14,840 shares during the period.

About Leslie’s

Leslie’s, Inc (NASDAQ: LESL) is the largest direct-to-consumer retailer of swimming pool supplies and related equipment in the United States. Through a network of more than 900 company-operated stores and a robust e-commerce platform, the company offers a comprehensive range of pool chemicals, cleaning tools, pumps, filters, heaters and pool accessories. In addition to product retailing, Leslie’s provides in-store and in-home water testing services, equipment installation, repair and ongoing maintenance programs designed to support both residential and commercial pool owners.

Founded in 1963 in North Miami Beach, Florida, Leslie’s has grown from a single neighborhood pool-supply shop into a national specialty retailer.