Recent Changes are Transforming the Narrative of Leslie's Investment
Analyst Price Target Changes: Leslie's consensus analyst price target has decreased significantly from $11.57 to $9.34, indicating a more cautious outlook on the company's valuation amid market uncertainties.
Mixed Analyst Sentiment: While some analysts, like Telsey Advisory, view Leslie's leadership positively, others have drastically lowered their price targets due to concerns over market share losses and weak sales guidance.
Financial Adjustments: Leslie's has engaged advisors to strengthen its balance sheet and has enacted a 1-for-20 reverse stock split, with updated fiscal year 2025 guidance projecting total sales between $1.210 billion and $1.235 billion alongside a net loss forecast.
Market Challenges: Analysts express heightened concerns about valuation and persistent risks, with common themes including competition, debt levels, and unpredictable weather impacting Leslie's growth potential and profitability.
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Goldman Sachs Downgrades MoonLake to Sell, Raises Price Target to $10
- MoonLake Downgrade: Goldman Sachs analyst Richard Law downgraded MoonLake Immunotherapeutics from Neutral to Sell while raising the price target from $8 to $10, indicating cautious sentiment despite the current share price of $17.41.
- Leslie’s Inc Rating Change: Morgan Stanley analyst Simeon Gutman downgraded Leslie’s Inc from Equal-Weight to Underweight, cutting the price target from $3.5 to $1.5, reflecting concerns about the company's future profitability with shares currently at $1.54.
- Rocket Lab Rating Adjustment: Keybanc analyst Michael Leshock downgraded Rocket Lab Corp from Overweight to Sector Weight, indicating a conservative outlook on its market performance, with shares priced at $91.80.
- Albertsons Downgrade: Morgan Stanley analyst Simeon Gutman downgraded Albertsons Companies Inc from Equal-Weight to Underweight, lowering the price target from $20 to $14, suggesting a pessimistic view on future growth as shares are currently at $17.71.
What’s Happening with Leslie's Stock Today?
Mixed Financial Results: Leslie’s, Inc. reported adjusted earnings per share of nine cents, significantly missing the consensus estimate of $1.29, while revenue of $389.20 million exceeded expectations of $370.63 million.
Store Closures and Strategic Changes: The company plans to close 80 to 90 underperforming stores and one distribution center as part of a strategy to improve EBITDA by fiscal 2026, alongside a 10% reduction in inventory.
Impairment Charges and Profit Margins: Leslie's recorded $183.8 million in impairment charges, with gross profit increasing by 4.8% to $150.1 million, despite a 6.5% decline in comparable sales.
Analyst Reactions and Stock Performance: Following the earnings report, analysts adjusted their price targets downward, with Leslie’s shares trading 20.95% lower at $2.83.
