On Thursday, Mizuho Securities adjusted its outlook on Leslie's Inc. (NASDAQ:LESL) by reducing the price target for the company's shares to $6.00, a decrease from the previous $7.00 target. The firm decided to maintain its existing rating on the stock.
The adjustment follows the company's fiscal second-quarter performance, which Mizuho views as indicative of continuing short-term challenges facing Leslie's. Discussions with Leslie's CFO Scott Bowman revealed several key points. Despite the adverse impact of severe flooding in Houston, Texas, Leslie's most significant residential market, the company experienced a "material improvement" in sales trends over a recent two-week period.
Additionally, while retail pricing has remained stable, some more aggressive promotional activities have been noted on the professional side of the business. Management has expressed optimism regarding factors within their control, such as a tighter expense profile, better inventory positioning, and improved supply chain operations.
The company's reaffirmation of its full-year 2024 earnings guidance is expected to bring some relief to the shares. The decision by Mizuho to lower the price target reflects these various factors and the current business environment Leslie's is navigating.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.