EP.003: Pool Corp ($POOL): Reverse Engineering Berkshire’s Investment, Buying a Great Company in a Lull
In addition to presenting high-conviction investment ideas, we also reverse engineer great investors’ theses to improve our process.
Pool Corp. has a leading position in a good industry and has demonstrated the ability to consistently grow FCF/share in the mid-teens with a high ROIC.
The current post-COVID pool industry downturn has led to negative sentiment, and long-term investors of great companies such as Berkshire see this as an opportunity to buy a great company at a “fair” price.
We use a reverse DCF to impute that consensus expects FCF to grow in the mid-single digits, which is below…
The skinny
The skinny isn't ready yet — notes appear once the transcript is processed.