UKRAINE – 2021/05/21: In this photo illustration the Pentair logo of an US water treatment company … [+]
[Updated: 10/4/2021] Pentair Stock Decline
The stock price of Pentair reached its all-time high levels of around $80 in mid-August, before a recent decline led the stock to levels of around $72 currently. There was no major development that should warrant a decline in PNR stock. That said, a couple of weeks back Pentair announced the acquisition of Pleatco – a manufacturer of water filtration and clean air technologies – for $255 million in cash. This deal will strengthen the company’s aftermarket water and air filtration space primarily for its pools business. Despite the recent decline, PNR stock is up over 3x since the lows of $24 it made in March 2020, when broader markets made a bottom. This can be attributed to strong demand for its residential pools business. With movement restriction in place, people started investing in their backyard, primarily on pools, driving the sales for Pentair. Despite the rising vaccination rate, and opening up of economies, this trend has so far not changed, and people continue to invest and maintain their backyards, evident from the company’s results over the recent quarters. The company has guided for $3.35 EPS for full-year 2021, implying over 40% growth from its 2019 EPS of $2.38.
But now that the PNR stock has seen a 5% drop in a week, will it continue its downward trajectory or is a rise in PNR stock imminent? According to the Trefis Machine Learning Engine, which identifies trends in the company’s stock price using nine years of historical data, returns for PNR stock average around 2.4% in the next one-month (twenty-one trading days) period after experiencing a 5% drop over the previous week (five trading days) implying that the stock will likely rebound in the near term. Overall, the company is likely to see continued demand for its residential pool business, and the Pleatco acquisition will aid its aftermarkets business for pools. But how would the returns fare if you are interested in holding PNR stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning Engine to test Pentair stock price forecast. You can test the chance of recovery over different time intervals of a quarter, month, or even just 1 day!
Some Fun Scenarios, FAQs & Making Sense of Pentair Stock Movements:
Question 1: Is the price forecast for Pentair stock higher after a drop?
Answer: Consider two situations,
Case 1: Pentair stock drops by -5% or more in a week
Case 2: Pentair stock rises by 5% or more in a week
Is the price forecast for Pentair stock higher over the subsequent month after Case 1 or Case 2?
PNR stock fares better after Case 1, with an expected return of 2.4% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an expected return of 1.9% for Case 2. This implies a price forecast of $74.37 in Case 1 and a figure of $74.01 in Case 2 using PNR market price of $72.63 on 9/30/2021.
In comparison, the S&P 500 has an expected return of 3.1% over the next 21 trading days under Case 1, and an expected return of just 0.5% for Case 2 as detailed in our dashboard that details the expected return for the S&P 500 after a rise or drop.
Try the Trefis machine learning engine above to see for yourself how the forecast for Pentair stock is likely to changes after any specific gain or loss over a period.
Question 2: Does patience pay?
Answer: If you buy and hold Pentair stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.
Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!
For PNR stock, the returns over the next N days after a -5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:
You can try the engine to see what this table looks like for Pentair after a larger loss over the last week, month, or quarter.
Question 3: What about the stock price forecast after a rise if you wait for a while?
Answer: The expected return after a rise is understandably lower than after a drop as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks – although PNR stock appears to be an exception to this general observation.
It’s pretty powerful to test the trend for yourself for Pentair stock by changing the inputs in the charts above.
[Updated: 8/26/2021] PNR Stock Rise
The stock price of Pentair, a water treatment and management company, has seen a rise of over 10% over the last twenty-one trading days, and it is up a solid 72% over the last twelve-month period. The rally in PNR stock over the last month or so has been propelled by its upbeat Q2 results, driven by continued high demand for residential business. The company has benefited from shelter-in-place restrictions during the pandemic, as people invested on pools in their backyards. Also, there has been a continued rise in water treatment demand in the residential market, primarily due to increased awareness about water quality. Even in Q2 2021, the company reported a large 44% jump in its largest segment – consumer solutions – which primarily targets the residential market.
However, the pandemic did adversely impact the company’s other business, industrial and flow technologies, due to reduced capital spending. Even this business is now seeing a rebound, with opening up of the economies. The segment revenues were up 17% in Q2. Furthermore, the company has already implemented price increases to counter the inflationary pressure on raw-materials. Looking forward, the company expects a strong demand environment, and it has also raised its full-year outlook with earnings expected to be $3.35 per share, at the mid-point of its range, compared to $3.15 earlier. This has boded will with the investors, and PNR stock is now trading at its lifetime high levels of around $80 currently.
But now that PNR stock has seen a large move in the recent past, will it continue its upward trajectory, or is a fall imminent? Going by historical performance, there is a higher chance of more gains in PNR stock over the next month. Out of 176 instances in the last ten years that PNR stock saw a twenty-one day rise of 10% or more, 126 of them resulted in PNR stock rising over the subsequent one-month period (twenty-one trading days). This historical pattern reflects 126 out of 176, or about a 72% chance of a rise in PNR stock over the coming month. See our analysis on Pentair Stock Chances of Rise for more details.
Calculation of ‘Event Probability‘ and ‘Chance of Rise‘ using last ten years data
Predict average return on Pentair Stock Return: AI Predicts PNR Average and Excess Return After a Fall or Rise
Pentair Stock Return (Recent) Comparison With Peers
While PNR stock may continue to see higher levels, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how counter-intuitive the stock valuation is for Haemonetics vs Pentair.
Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform dashboards.trefis.com) helps you understand how a company’s products, that you
Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform dashboards.trefis.com) helps you understand how a company’s products, that you touch, read, or hear about everyday, impact its stock price. Surprisingly, the founders of Trefis discovered that along with most other people they just did not understand even the seemingly familiar companies around them: Apple, Google, Coca Cola, Walmart, GE, Ford, Gap, and others. This might include you though you may have invested money in these companies, or may have been working with one of them for years as an employee, or have consulted with them as an expert for a long time. You can play with assumptions, or try scenarios, as-well-as ask questions to other users and experts. The platform uses extensive data to show in a single snapshot what drives the value of a company’s business. Trefis is currently used by hundreds of thousands of investors, company employees, and business professionals.