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Why Is Lindsay (LNN) Up 7.7% Since Last Earnings Report?

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A month has gone by since the last earnings report for Lindsay (LNN - Free Report) . Shares have added about 7.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Lindsay due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Lindsay Q1 Earnings Beat Estimates, Revenues Increase Y/Y

Lindsay delivered earnings per share of $1.57 in first-quarter fiscal 2025, beating the Zacks Consensus Estimate of $1.34. The bottom line improved 15% year over year.
The company generated revenues of $166 million, up from $161 million in the year-ago quarter. The top line met the Zacks Consensus Estimate.

The company’s backlog as of Nov. 30, 2024, was around $168 million compared with roughly $87 million as of Nov. 30, 2023.

Q1 Operational Update

The cost of operating revenues improved 4.4% year over year to around $116 million. The gross profit was $50 million, fairly flat from the year-earlier quarter. The gross margin was 30.1% compared with the year-ago quarter’s 31%.
Operating expenses were around $29 million in the fiscal first quarter, up 0.7% year over year. Operating income was roughly $22 million, up from the prior-year quarter’s $21 million.

Q1 Segmental Results

The Irrigation segment’s revenues rose 5% year over year to around $147 million in the fiscal first quarter. North America’s irrigation revenues fell 13% from the year-ago quarter to roughly $78 million, due to lower unit sales volume. The International irrigation segment’s revenues grew 37% year over year to around $69 million. 

The Irrigation segment’s operating income fell 2% year over year to $24.7 million. 

The Infrastructure segment’s revenues decreased 9% year over year to roughly $19 million. The downside was caused by a difference in the timing of Road Zipper System lease revenues. The segment reported an operating income of $4.1 million, up 14% year over year.

Financial Position

Lindsay had cash and cash equivalents of roughly $194 million at the end of the first quarter of fiscal 2025 compared with $159 million as of end of the first quarter of fiscal 2024. The company’s long-term debt was around $115 million as of Nov. 30, 2024, flat with the reported figure on Nov. 30, 2023.

FY25 Outlook

The company expects growth in its infrastructure segment in fiscal 2025 aided by the large Road Zipper System project LNN recently secured. In North America and Brazil’s irrigation markets, the market conditions are expected to remain soft in the near term.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision flatlined during the past month.

The consensus estimate has shifted 7.96% due to these changes.

VGM Scores

Currently, Lindsay has a strong Growth Score of A, a grade with the same score on the momentum front. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Lindsay has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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