Warren Buffett’s Berkshire Hathaway has increased its stake in Pool Corp, according to a Form 13-F regulatory filing released on February 14.
The conglomerate first jumped into Pool Corp in the third quarter of 2024 and doubled down in the fourth, boosting its holdings by 48 percent to a total of 598,698 shares — now worth more than $204 million.
What does Buffett see in Pool Corp?
For one thing, the pool industry appears poised for growth. According to the Pew Research Center, the southern part of the U.S. remains home to the fastest-growing states in the country, with South Carolina, Florida, and Texas leading the way. Summers in these states are brutally hot — if you can afford it, you’re putting in a pool.
Meanwhile, Pool Corporation (NASDAQ:POOL) is the leading wholesale distributor of swimming pool equipment, parts, supplies, and related outdoor living products. The company operates approximately 440 sales centers across North America, Europe, and Australia, distributing more than 200,000 products from more than 2,200 vendors to 125,000 wholesale customers.
Buffett, who famously advises investors to “buy what you believe in,” seems to like what he sees. Pool Corp ranks among the top-rated companies for long-term investment, boasting a financial score of 99/99. Pool Corp.
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For dividend investors, POOL is also worth a look. Berkshire Hathaway tends to favor stocks with steady returns, and Pool Corp’s 1.4 percent dividend yield fits the bill. While not sky-high, the company has been increasing payouts for 14 consecutive years. Over the past three years, POOL’s annual dividend growth rate was 23.4 percent. Over the last decade, dividends per share have grown at an impressive 19.8 percent annual rate. Currently, shareholders enjoy an annual payout of $4.80 per share — a strong incentive to stick around.
It’s also worth noting some of the other changes Buffett has made to his portfolio. Last year, he significantly reduced holdings in Apple, Bank of America, and Citigroup.
At the same time, he’s been ramping up positions in Domino’s Pizza and recently added 5.6 million shares of Constellation Brands, the maker of Modelo, Corona, and Pacifico beers. Constellation also owns a significant stake in Canadian cannabis producer Canopy Growth. Additionally, Buffett purchased more than 12 million shares of satellite radio provider Sirius XM.
This rebalancing suggests he’s positioning for a consumer-driven market, focusing on real-life pleasures people will pay for, regardless of market conditions.
Indeed, the “Oracle of Omaha” appears to be forecasting plenty of pool parties — complete with music, pot, pizza, and beer.
