Latham Group, Inc. (SWIM) Stock Analysis

Why this analysis is different

• A sector-relative MoonshotScore — five pillars (business quality, financial safety, valuation, growth durability, momentum) re-ranked nightly against the full universe of US-listed common stocks.
• An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
• Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.

Latham Group, Inc. (SWIM) Industrial Operations Profile

Latham Group, Inc. specializes in the design, manufacture, and marketing of in-ground residential swimming pools, covers, and liners. Operating across North America, Australia, and New Zealand, Latham distinguishes itself through a comprehensive product portfolio and established market presence in the construction sector, despite a relatively low profit margin of 1.5%.

What Is the Investment Thesis for SWIM?

Latham Group, Inc. presents a mixed investment case. The company's established market position in the in-ground residential swimming pool industry, coupled with its geographic diversification across North America, Australia, and New Zealand, provides a stable revenue base. However, the company's relatively high P/E ratio of 135.84, combined with a low profit margin of 1.5%, raises concerns about profitability and valuation. Growth catalysts include potential expansion into new geographic markets and the introduction of innovative product offerings. The company's beta of 1.75 indicates higher volatility compared to the market, which could present opportunities for short-term gains but also carries increased risk. Investors should carefully weigh the potential for growth against the challenges of profitability and valuation before making an investment decision. Monitoring key financial metrics, such as revenue growth and margin expansion, will be crucial in assessing the company's performance.

Based on FMP financials and quantitative analysis

SWIM Key Highlights

Market Cap of $743M reflects Latham's current valuation in the market.

• P/E ratio of 135.84 indicates a premium valuation compared to earnings.
• Gross Margin of 28.5% demonstrates the company's ability to manage production costs.
• Profit Margin of 1.5% highlights potential areas for improvement in operational efficiency.
• Beta of 1.75 suggests higher volatility compared to the overall market.

Who Are SWIM's Competitors?

SWIM is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance This table mixes two scoring engines — compare a number only with others carrying the same tag.

What Are SWIM's Key Strengths?

Established brand reputation.

• Extensive distribution network.
• Comprehensive product portfolio.
• Geographic diversification.

What Are SWIM's Weaknesses?

Relatively low profit margin.

• High P/E ratio.
• High beta indicating higher volatility.
• Dependence on housing market conditions.

What Could Drive SWIM Stock Higher?

Potential expansion into new geographic markets in Europe and South America.

• Continued focus on product innovation and development of smart pool technology.
• Strategic partnerships with home builders and landscapers to drive sales.
• Marketing initiatives to increase brand awareness and customer engagement.

What Are the Key Risks for SWIM?

Rich valuation — a P/E of 135.84 runs well above the Industrials sector’s ~28.00x, leaving little room for a miss.

• Economic downturns affecting consumer spending on discretionary items like swimming pools.
• Increased competition from other pool manufacturers and distributors.
• Fluctuations in raw material prices impacting production costs.
• Changes in building codes and regulations affecting pool installation requirements.
• Seasonality of the swimming pool market impacting revenue and profitability.

What Are the Growth Opportunities for SWIM?

• Expansion into Adjacent Product Categories: Latham can leverage its existing distribution network and brand reputation to expand into adjacent product categories, such as outdoor furniture, pool accessories, and landscaping materials. This would allow the company to capture a larger share of the consumer's outdoor living budget and drive incremental revenue growth. The market for outdoor furniture and accessories is estimated to be worth billions of dollars annually, presenting a significant opportunity for Latham.
• Geographic Expansion: While Latham already operates in North America, Australia, and New Zealand, there are opportunities to expand into other geographic markets, such as Europe and South America. These markets have a growing demand for residential swimming pools and related products, driven by increasing disposable incomes and a desire for outdoor living spaces. Successful expansion into these markets would significantly increase Latham's revenue and market share.
• Product Innovation: Latham can invest in research and development to develop innovative new products that meet the evolving needs of its customers. This could include smart pool technology, energy-efficient pool systems, and eco-friendly pool materials. By staying ahead of the curve in terms of product innovation, Latham can differentiate itself from its competitors and attract new customers. The market for smart pool technology is expected to grow rapidly in the coming years.
• Strategic Acquisitions: Latham can pursue strategic acquisitions of smaller companies in the swimming pool industry to expand its product portfolio, geographic reach, and customer base. This would allow the company to quickly gain access to new markets and technologies, as well as eliminate competition. There are numerous smaller companies in the swimming pool industry that would be attractive acquisition targets for Latham.
• Enhanced Marketing and Branding: Latham can invest in enhanced marketing and branding efforts to increase brand awareness and drive sales. This could include targeted advertising campaigns, social media marketing, and partnerships with home builders and landscapers. By strengthening its brand reputation and increasing its visibility in the market, Latham can attract new customers and retain existing ones. A strong brand is a valuable asset in the competitive swimming pool industry.

What Are SWIM's Competitive Advantages?

• Established brand reputation in the in-ground swimming pool market.
• Extensive distribution network across North America, Australia, and New Zealand.
• Comprehensive product portfolio including pools, covers, and liners.
• Focus on innovation and product development.

What Does SWIM Do?

Latham Group, Inc., headquartered in Latham, New York, is a prominent player in the residential swimming pool industry. Founded in 2018 as Latham Topco, Inc., the company rebranded to Latham Group, Inc. in March 2021. Latham designs, manufactures, and markets a comprehensive range of in-ground residential swimming pools, pool covers, and pool liners. Their products cater to homeowners seeking to enhance their outdoor living spaces with high-quality, durable, and aesthetically pleasing swimming pool solutions. The company's geographic footprint spans North America, Australia, and New Zealand, allowing it to serve a diverse customer base with varying preferences and climates. Latham's product portfolio includes a variety of pool styles, sizes, and materials, as well as a range of complementary products such as pool covers designed to improve safety and energy efficiency, and liners that enhance the pool's appearance and longevity. Latham's competitive positioning is built on its established brand reputation, extensive distribution network, and focus on innovation and product development. The company continually strives to improve its product offerings and manufacturing processes to meet the evolving needs of its customers and maintain its leadership position in the market.

What Products and Services Does SWIM Offer?

• Designs in-ground residential swimming pools.
• Manufactures in-ground residential swimming pools.
• Markets in-ground residential swimming pools.
• Offers a portfolio of pool covers.
• Provides pool liners.
• Serves customers in North America, Australia, and New Zealand.

How Does SWIM Make Money?

• Designs and manufactures in-ground swimming pools and related products.
• Sells products through a network of dealers and distributors.
• Generates revenue from the sale of pools, covers, and liners.
• Focuses on residential customers.

What Industry Does SWIM Operate In?

Latham Group, Inc. operates within the construction industry, specifically focusing on the residential swimming pool market. This market is influenced by factors such as housing starts, consumer spending, and climate conditions. The industry is characterized by a mix of large, established players and smaller, regional companies. Latham's competitive advantage lies in its established brand reputation, extensive distribution network, and comprehensive product portfolio. The market is expected to experience moderate growth in the coming years, driven by increasing demand for outdoor living spaces and rising disposable incomes.

Who Are SWIM's Key Customers?

• Homeowners seeking to install in-ground swimming pools.
• Residential construction companies.
• Pool dealers and distributors.
• Customers in North America, Australia, and New Zealand.

Company Profile

Latham Group, Inc. operates in the Construction Materials industry within the Basic Materials sector. It is headquartered in Latham, US. The company is led by CEO Sean Gadd. SWIM has traded publicly since 2021.

Return on equity for Latham Group, Inc. stands at 1.3%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 0.6%, showing how much profit it generates from its asset base. SWIM trades at a trailing price-to-earnings ratio of 135.84, above the Industrials sector average of ~28.00x. Its free cash flow yield is 4.8%, a gauge of the cash the business throws off relative to its market value. A current ratio of 2.16 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 0.7%, the inverse of the P/E and a quick read on earnings relative to price.

SWIM Valuation & Market Position

With a $743M market cap, Latham Group, Inc. sits in the small-cap segment of the market. Analyst price targets span from $4.00 to $30.00, with a consensus of $10.64. At the current price of $6.33, that implies approximately 68% upside potential. Relative to its peer group, SWIM's quantitative score of 55/100 is below the peer average of 69/100.

Quarterly Financial Performance: Latham Group, Inc.

Revenue for Latham Group, Inc. came in at $197.5M during Q2 FY2026, a 68.3% improvement versus the preceding quarter. The company recorded net income of $12.8M, with diluted EPS of $0.11. Revenue has increased across the last three reported quarters, suggesting sustained momentum for this small-cap Industrials company. Across the four most recent quarters, SWIM averaged $0.01 in diluted EPS.

Latham Group, Inc.'s Piotroski F-Score is 6/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 1.91 places it in the grey zone, a middle ground that warrants monitoring.

Latham Group, Inc. has beaten Wall Street's EPS estimate in 4 of its last 8 reported quarters — more hits than misses. Reported results have landed about 7.7% below estimates on average.

Over the past six months, Latham Group, Inc. insiders filed 12 SEC Form 4 transactions — 3 sales and 9 purchases. On net that is roughly 164K shares acquired (about $236K) — insiders putting money in tends to read as conviction.

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Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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