Leslie’s posted sparkling quarterly results, and the analysts said this:
We were out with our takeaways following meetings with management. While pool usage will likely decline from peak COVID levels, mgmt noted that growth in the US pool owner installed base and market share gains are larger contributors to the company’s chemical/equipment demand. Further, while smaller peers have had challenges procuring chlorine tabs, the vast majority of Leslie’s locations are in-stock. And with industry supply constrained through pool season 2022 we think the company’s vertical integration and aggressive procurement strategy render them well-positioned. Moreover, we noted that heading into next pool season, Leslie’s has purchased more than ever from its top 3 equipment providers, an indicator of a strong demand pipeline.
The Jefferies price target on Leslie’s stock of $39 is higher than the $32.25 consensus target. The final print for Wednesday was reported at $22.61 a share.
This may be the perfect value financial for a growth portfolio. Synchrony Financial (NYSE: SYF) is one of the nation’s premier consumer financial services companies. It is the self-described largest provider of private label credit cards in the United States, based on purchase volume and receivables.
Synchrony Financial provides a wide range of credit products through programs established with a diverse group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and health care service providers to help generate growth for its partners and offer financial flexibility.
Top analysts have noted in the past that private label cards are gaining share, and their research suggests a continuation of that trend. They also note that retailers continue to push back on rates, and private label cards offer more of a symbiotic relationship for retailers. Jefferies discussed its prospects:
We were out with our takes from the company’s Analyst Day. We believe that Synchrony Financial’s broad product suite in combination with its data and analytics platform and technology stack enable the company to compete within the buy now, pay later segment while also creating a higher lift for retail partners while at a substantially lower cost. Long term we believe the company is well positioned for growth given its diversified product set, strong digital platform and growth channels. Additionally, we consider the 7%-10% receivables growth as very achievable in the context of recent partner additions, ongoing penetration at existing retailers and in the context of the company’s diversified business model.
Shareholders receive a 1.85% dividend. Jefferies has set a $58 price target, and the consensus target is $57.21. Synchrony Financial stock closed at $48.24 on Wednesday.
These four companies have posted solid results, have very strong business lines and have the ability to weather storms in the economy due to their positioning. These top growth stock picks offer good entry points for growth buyers looking to add new names that have far lower volatility than crowded momentum stocks.
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