Mizuho lowered its price target on Leslie's (NASDAQ:LESL) to $1 from $3 while maintaining a Neutral rating, citing persistent top-line headwinds and deteriorating margins that have prompted downward revisions to earnings forecasts. As a result, the company’s shares fell over 4% intra-day today.

The analysts reduced Leslie’s 2025 adjusted EBITDA estimate to $98 million from $108 million, aligning it closer to company guidance of $96–$116 million. For 2026, the estimate was cut sharply to $122 million from $167 million, reflecting heightened concerns about the company’s ability to regain momentum.

Given Leslie’s elevated leverage of around 6x net debt/EBITDA at the end of Q2, Mizuho switched its valuation methodology from an EPS-based multiple to EV/EBITDA, setting the new $1 price target at around 8x 2026 adjusted EBITDA. This multiple mirrors forward valuations seen among struggling retail peers such as Target, Albertsons, and Best Buy.

Mizuho’s cautious stance reflects skepticism over Leslie’s ability to navigate current challenges, warning that prolonged sales and margin pressures could weigh heavily on both earnings and balance sheet flexibility.