Hayward Holdings, Inc. (NYSE: HAYW)

Sector: Industrials Industry: Electrical Equipment & Parts CIK: 0001834622
Market Cap 3.55 Bn
P/B 2.33
P/E 25.75
P/S 3.23
ROIC (Qtr) 6.93
Div Yield % 0.00
Rev 1y % (Qtr) 7.37
Total Debt (Qtr) 961.16 Mn
Debt/Equity (Qtr) 0.63
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About

Hayward Holdings, Inc., often recognized by its stock symbol HAYW, operates in the pool equipment industry, offering a comprehensive range of pool equipment and automation systems. The pool equipment industry is characterized by significant aftermarket requirements, innovation-led growth opportunities, and a conducive industry structure. Hayward's operations are divided into two segments: North America (NAM) and Europe & Rest of World (E&RW). The NAM segment contributes approximately 83% to the company's total net sales, while the E&RW segment...

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Investment thesis

Bull case

  • Healthy cash reserves of 428.68M provide 31.96x coverage of short-term debt 13.41M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 219.28M provides strong 16.72x coverage of stock compensation 13.12M, indicating sustainable incentive practices.
  • Robust free cash flow of 191.15M exceeds capital expenditure of 28.14M by 6.79x, indicating strong organic growth funding capability.
  • Operating cash flow of 219.28M provides solid 0.84x coverage of current liabilities 262.46M, showing strong operational health.
  • Cash reserves of 428.68M provide ample 66.12x coverage of acquisition spending 6.48M, enabling strategic growth opportunities.

Bear case

  • Operating cash flow of 219.28M barely covers its investment activities of (41.30M), with a coverage ratio of -5.31, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (41.30M) provide weak support for R&D spending of 26.14M, which is -1.58x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Free cash flow of 191.15M represents just -9.12x of debt issuance (20.95M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Retained earnings of 782.72M provide limited buffer against comprehensive income items of (5.93M), which is -132.04x, indicating elevated exposure to market risks.
  • Tax assets of 2.55M provide limited offset against tax liabilities of 238.89M, which is 0.01x, indicating potential future cash flow pressure from tax obligations.

Segments Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Electrical Equipment & Parts
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 VRT Vertiv Holdings Co 93.00 Bn 69.78 9.09 3.16 Bn
2 BE Bloom Energy Corp 34.73 Bn -392.76 17.16 2.99 Bn
3 HUBB Hubbell Inc 27.97 Bn 31.52 4.78 2.33 Bn
4 NVT nVent Electric plc 19.43 Bn 76.81 8.40 1.56 Bn
5 AYI Acuity Inc. (De) 12.85 Bn 109.95 6.86 0.91 Bn
6 AEIS Advanced Energy Industries Inc 11.80 Bn 79.52 6.56 0.68 Bn
7 NVX NOVONIX Ltd 11.53 Bn -174.00 1,943.36 -
8 ENS EnerSys 6.79 Bn 21.71 1.82 1.18 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.37 3.49
EV to Cash from Ops. EV/CFO 18.92 9.10
EV to Debt EV to Debt 4.32 113.17
EV to EBIT EV/EBIT 18.44 -17.64
EV to EBITDA EV/EBITDA 14.77 3.56
EV to Free Cash Flow [EV/FCF] EV/FCF 21.70 39.13
EV to Market Cap EV to Market Cap 1.17 2.59
EV to Revenue EV/Rev 3.77 77.74
Price to Book Value [P/B] P/B 2.33 4.98
Price to Earnings [P/E] P/E 25.75 23.89
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -2.92
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 3.27
Dividend per Basic Share Div per Share (Qtr) 0.00 0.37
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.79
Interest Coverage Int. cover (Qtr) 4.31 -16.86
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -12.50 -135.37
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 56.35 92.17
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 5.22
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 21.77 -45.52
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 16.92 -56.26
EBIT Growth (1y) % EBIT 1y % (Qtr) 20.86 -64.20
EBT Growth (1y) % EBT 1y % (Qtr) 44.13 8.52
EPS Growth (1y) % EPS 1y % (Qtr) 42.22 13.91
FCF Growth (1y) % FCF 1y % (Qtr) -12.46 -66.58
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 12.89 15.53
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.36 0.63
Cash Payout Ratio Cash Payout (Qtr) 0.00 -0.10
Cash Ratio Cash Ratio (Qtr) 1.63 3.50
Current Ratio Curr Ratio (Qtr) 3.18 5.07
Debt to Equity Ratio Debt/Equity (Qtr) 0.63 0.41
Interest Cover Ratio Int Coverage (Qtr) 4.31 -16.86
Times Interest Earned Times Interest Earned (Qtr) 4.31 -16.86
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 25.80 -1,947.23
EBIT Margin % EBIT Margin % (Qtr) 20.45 -2,051.19
EBT Margin % EBT Margin % (Qtr) 15.71 -2,170.94
Gross Margin % Gross Margin % (Qtr) 51.30 2.02
Net Profit Margin % Net Margin % (Qtr) 12.50 -2,202.04