Pool Corp Stock: Why Buffett's Bet Might Be Your Entry Point

The Setup: Pool Corp operates a simple but profitable business model — it’s the world’s largest wholesaler for swimming pool equipment and supplies. But here’s the catch: not all of its revenue is created equal.

The Revenue Split That Matters

Two very different businesses are hiding inside one ticker. About one-third comes from new pool installations, which have been crushed by the same interest rate spike that tanked the housing market. Installations peaked during the pandemic lockdown boom, then collapsed. That’s the problem.

The other two-thirds? That’s recurring revenue from maintenance and repairs. Even pools sitting unused need chemicals and upkeep — nobody wants their $50k investment turning into a swamp. This recurring stream is why the company can sustain its 2.1% dividend even when new builds stall.

Why You’re Buying Cheaper Than Buffett

Here’s where it gets interesting. Pool is trading around $233/share — a price it hasn’t touched since early 2020. Meanwhile, Berkshire Hathaway’s recent buying spree paid between $285 and $390 per share, depending on timing.

Translation: You’re getting an 18-40% discount to what one of the world’s sharpest investors just paid. That’s not nothing.

But before you celebrate, understand why the stock cratered from its 2021 peak of $578.

The Real Constraint

Here’s the hard truth: Pool is a distributor, not a manufacturer. It can’t just raise prices whenever it wants — competitors will steal customers. The only way to grow maintenance revenue meaningfully is to have more pools to service. And new pools mainly get built when housing is booming.

The housing market isn’t booming. It might not be for years.

The Waiting Game

If you buy Pool today, you’re essentially betting that the real estate cycle will eventually turn. You’re not buying for immediate growth — you’re buying a discounted yield play (2.1%) while you wait for the housing recovery to unlock the installation side of the business.

That’s a marathon bet, not a sprint trade. Make sure you have the patience for it.