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Lindsay (LNN) Earnings & Sales Beat Estimates in Q3, Up Y/Y

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Lindsay Corporation (LNN - Free Report) delivered earnings per share of $1.61 in third-quarter fiscal 2021 (ended as of May 31, 2021), beating the Zacks Consensus Estimate of $1.22. The bottom-line figure surged 73.1% year over year.

Lindsay generated revenues of $162 million compared with the $123 million reported in the year-ago quarter. The top-line figure also surpassed the Zacks Consensus Estimate of $147 million.

The company’s backlog at the end of the reported quarter was $120.8 million compared with the $78.6 million witnessed at the end of the year-earlier quarter.

Operational Update

Cost of operating revenues went up 42.2% year on year to $118 million. Gross profit was up 12.8% to $44 million from the year-earlier quarter. Gross margin came in at 27.2% compared with the year-ago quarter’s 32.2%.

Operating expenses came in at $23 million during the fiscal third quarter compared with the year-ago quarter’s $24 million. The company recorded an operating income of $21 million, suggesting year-over-year growth of 31.2%. Operating margin came in at 13% in the reported quarter, flat year over year.

Lindsay Corporation Price, Consensus and EPS Surprise

Lindsay Corporation Price, Consensus and EPS Surprise

Lindsay Corporation price-consensus-eps-surprise-chart | Lindsay Corporation Quote

Segment Results

The Irrigation segment revenues increased 45.8% year over year to $140 million during the fiscal third quarter. North America irrigation revenues increased 38% from the year-ago quarter to $87 million, primarily on greater irrigation equipment unit sales volume and higher average selling prices. International irrigation revenues climbed 60.6% year over year to $53 million on higher unit sales volumes in several international markets, higher prices and favorable foreign currency translation. The segment’s operating income improved 60% year on year to $24 million. Given higher agricultural commodity prices, Lindsay witnessed strong irrigation equipment demand across the globe.

The Infrastructure segment revenues declined 21.4% year over year to $22 million on lower Road Zipper System sales, partly offset by higher lease revenues and increased road safety products sales. The segment reported an operating income of $4 million compared with the prior-year quarter’s $8 million.

Financial Position

Lindsay had cash and cash equivalents of $121 million at the end of the fiscal third quarter compared with the $102 million at the end of the prior-year quarter. The company’s long-term debt stood at $116 million at the end of the fiscal third quarter, flat year on year.

Outlook

The company will continue to witness robust demand for irrigation equipment, driven by upbeat agricultural commodity prices and solid farm prospects. Management anticipates infrastructure business to improve as coronavirus restrictions are lifted and road construction activity returns to normal levels. However, Lindsay expects that material cost inflation and supply-chain constraints will continue to dent its margins in fiscal 2021.

Price Performance

Lindsay’s shares have appreciated 34.4% so far this year, outperforming the industry’s growth of 29%.

Zacks Investment ResearchImage Source: Zacks Investment Research

Zacks Rank & Other Stocks to Consider

Lindsay currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

A few other top-ranked stocks in the Industrial Products sector are Tennant Company (TNC - Free Report) , Encore Wire Corp. (WIRE - Free Report) and Arconic Corp. (ARNC - Free Report) . All of these stocks sport a Zacks Rank #1, at present.

Tennant has an anticipated earnings growth rate of 49.5% for 2021. The company’s shares have gained around 18%, year to date.

Encore Wire has an estimated earnings growth rate of 49.5% for the ongoing year. Year to date, the company’s shares have rallied nearly 36%.

Arconic has a projected earnings growth rate of 447% for the current year. The stock has appreciated around 21%, so far this year.

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