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Lindsay Rises After Quarterly Earnings Beat

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Lindsay Corp. Shares Drop on Dismal Earnings - Analyst Blog
Earnings Scheduled For June 25, 2014

Wednesday morning, Lindsay Corporation (NYSE: LNN) posted quarterly earnings per share (EPS) and revenue that beat analysts' expectations.

The irrigation and road infrastructure company reported third-quarter 2012 EPS of $1.47, about 11 cents higher than the consensus analyst estimate, as well as up from $1.20 per share in the same quarter of last year.

In addition, the company reported quarterly revenues near $172.1 million, or about 3.6% higher than the consensus analyst estimate and 12% higher than revenues in the same period last year.

In a statement, President and Chief Executive Officer Rick Parod said, "Farm incomes and commodity prices have driven positive farmer sentiment, leading to increased domestic irrigation demand."

At the end of the quarter, Lindsay's cash and cash equivalents balance was around $19.2 million higher than it was at the end of third-quarter 2011. Debt was $4.3 million lower over the same time frame.

Parod also said, "The increase in sales, along with cost reductions and efficiency improvements across our business segments have resulted in higher operating margins in the third quarter."

Lindsay's gross margin rose to around 28.5%, compared to 27.0% in the third quarter of 2011.

Lindsay had a price-to-earnings (PE) ratio near 19.5 Wednesday, while fellow farming equipment provider Deere & Company (NYSE: DE) had a PE ratio closer to 10.5. AGCO (NYSE: AGCO), another agricultural equipment provider, had a PE ratio around 6.5.

Perhaps, Linsday's relatively high price-to-earnings ratio is partially related to analysts' growth expectations for the company. Analysts expect earnings growth from Lindsay of approximately 22.6% over the next five years. In contrast, analysts expect Deere EPS to grow at around 12.3% and AGCO to grow at near 12.7% over similar period.

Following the better-than-expected results, Linsday traded more than 5% higher Wednesday morning.

Disclosure: At the time of this writing, I did not own shares of any companies mentioned in this post.

Posted-In: AGCO Deere LindsayEarnings News Trading Ideas

 

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