Hayward Earnings: Well Positioned to Return to Growth in 2024

Narrow-moat-rated Hayward ended 2023 on a strong note, as its full-year net sales of $993 million and adjusted earnings per share of $0.56 both came in above our estimates of $973 million and $0.55, respectively. After rolling our model forward one year, we’ve raised our fair value estimate to $15.20 from $14.20, which reflects our slightly more optimistic operating margin assumptions as well as time value of money. The stock jumped by as much as 20% intraday on Feb. 29 following the strong earnings release, and we now see the name as fairly valued relative to our updated fair value estimate.