Key Highlights

  • Adjusted EPS was $1.18 versus $1.24 a year earlier, ahead of a screened estimate of $1.07.
  • Net sales fell to $976.4 million from $1,022.0 million, with core sales down 5.5%.
  • Pool sales fell 17.7% and segment income fell 38%, while Flow and Water Solutions income rose 15% and 16%.
  • Full-year adjusted EPS guidance holds at a midpoint of about $4.70, with fourth-quarter adjusted EPS near $1.15.
  • Free cash flow was $619.9 million for nine months, and $350.0 million of shares were repurchased.

Pentair Earnings: Did Adjusted EPS of $1.18 Show the Pool Reset Is Ending?

Pentair (NYSE:PNR) reported third-quarter adjusted EPS of $1.18 on Tuesday, October 27, down from $1.24 a year earlier but above the $1.07 estimate as screened. GAAP diluted EPS was $0.91, versus $1.12. The company reaffirmed the midpoint of its full-year adjusted EPS guidance at about $4.70.

Net sales were $976.4 million, with core sales down 5.5%. Management said Pool results reflected completion of the inventory realignment with its major channel partners.

Segment Results: Why Did Pool Sag While Flow and Water Solutions Improved?

Pool sales fell 17.7% to $291.5 million, and segment income fell 38% to $71.7 million. The segment margin was 24.6%, down 820 basis points.

Flow sales rose 4.4% to $262.5 million, with core growth of 1%, and segment income rose 15% to $68.8 million at a 26.2% margin, up 250 basis points. Water Solutions sales rose 1.4% to $421.9 million, and segment income rose 16% to $120.9 million at a 28.7% margin, up 370 basis points.

Consolidated adjusted operating income fell 8% to $242.0 million, and the adjusted return on sales was 24.8% versus 25.7%. Results included about $8 million of IEEPA tariff refunds.

Guidance: What Do the Fourth-Quarter and Full-Year Targets Imply?

For the fourth quarter, Pentair expects reported sales up about 7% to 9%, GAAP EPS near $1.07 and adjusted EPS near $1.15. That adjusted figure compares with $1.18 in the third quarter.

For 2026, the company expects reported sales down about 3%, adjusted EPS of about $4.70 and GAAP EPS of about $3.76. Adjusted operating income is forecast to decline about 6%, and net income is expected near $605 million on a GAAP basis and $757 million adjusted.

The outlook includes channel inventory right-sizing ahead of the 2027 pool season and the Taco Group Holdings acquisition, which closed on October 1. The release gave no purchase price or Taco revenue figures.

Cash, Debt and Returns: How Strong Is the Balance Sheet After the Reset?

Free cash flow was $152.7 million in the quarter, versus $178.9 million, and $619.9 million for nine months, versus $719.0 million. Capital expenditures were $54.2 million for nine months.

Pentair repurchased $350.0 million of shares in nine months, double the $175.0 million of a year earlier, and diluted shares fell to 160.3 million from 165.1 million. Long-term debt fell to $1,484.1 million from $1,638.6 million at year-end 2025, and cash was $74.0 million.

A quarterly dividend of $0.27 per share is payable on Friday, November 6, marking the 50th consecutive year of dividend increases. Net interest expense rose to $21.7 million from $14.4 million.

What to Watch Next: Can Pool Demand Rebuild Into 2027?

The call is scheduled for Wednesday, October 28. Investors will look for Pool order trends, Taco integration details, the cadence of the roughly 7% to 9% fourth-quarter sales rise, and management's view of significant growth in 2027.