Pentair Earnings: Solid Margin Expansion Despite Revenue Headwinds

Narrow-moat-rated Pentair finished the year with a solid fourth quarter, as its full-year revenue of $4,105 million and adjusted EPS of $3.75 both came in above our estimates of $4,071 million and $3.73, respectively. This outperformance was driven primarily by pool sales beating our expectations, as volumes increased sequentially from the third quarter. While nothing in the earnings release materially alters our long-term outlook, we’ve bumped our fair value estimate up to $72 from $70, mostly due to the time value of money.