This Analyst Opts To Stay On The Sidelines Until Leslie's Return To Stable & Sustainable Growth - Leslies (NASDAQ:LESL)

Telsey Advisory Group analyst Dana Telsey reiterated a Market Perform rating on the shares of Leslie's Inc LESL and lowered the price target from $16 to $15.
Leslie's reported strong 4Q22 results and reiterated its long-term financial outlook, said the analyst.
The results highlighted progress on structural initiatives, including targeting of new customers, leveraging of loyalty members, expanding new products and services, opening new stores, enhancing water-testing, both in-store and home, focusing on Pro customers, and executing on M&A opportunities.
Telsey said she is encouraged by solid early results of AccuBlue Home pilot, with planned expansion of AccBlue Home (version 2) in FY23 and beyond.
She believes the concept could be transformative for the company and the industry.
However, the analyst added, Leslie's FY23 outlook fell short of expectations, both sales and profits, primarily incorporating a tough macro environment.
She also said the return to normalization and lapping the difficult comparisons after three strong years—19.8% in FY20, 20.7% in FY21, and 16.3% in FY22, is pressuring the FY23 outlook.
Though many of the macro headwinds are transitory and are currently masking the progress on core structural initiatives, the analyst would choose to stay on the sidelines until she sees a return to stable and sustainable growth.
Price Action: LESL shares are trading lower by 1.75% at $14.35 on the last check Thursday.
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