“Pool Corporation (NASDAQ:POOL) is the world’s largest distributor of swimming pool supplies, equipment, and related leisure products and is also one of the top three distributors of irrigation and landscape suppliers in the U.S. The company sells over 200,000 products from over 2,200 suppliers to over 120,000 professional contract and retailer customers through its 400-plus sales centers across 12 countries, with 70% of its transactions occurring in person. Within its core pool category, Pool has strong market share and is bigger than its next fifty competitors combined, giving Pool a strong scale advantage and allowing the company to invest in its products, technology, customer service, and supply chain to differentiate itself. Over 60% of Pool’s revenues come from maintenance and repair of existing pools, providing Pool with a large and growing recurring revenue base as more pools are built each year.

Pool has a long history of delivering organic and inorganic growth supported by the recurring nature of most of its revenues while consistently taking market share each year. We believe management will continue to deliver on its growth targets as the company today benefits from favorable U.S. population migration trends and demographic shifts (de-urbanization, southern migration), an aging pool installed base, an increasing number of new features, and technology content both in and around the pool. Pool also recently acquired Porpoise Pool & Patio, which includes a retail store franchise business and chemical packaging operation, enabling new sales and margin growth opportunities for the business.

As the stock sold off on fears of a housing-related slowdown in the pool industry, we accumulated additional shares of this best-in-class company as we believe the current share price is attractive relative to the long-term growth opportunity and value of the business.”