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Lindsay (LNN) Earnings & Sales Beat Estimates in Q2, Up Y/Y

·4 min read

Lindsay Corporation LNN delivered earnings per share of $1.32 in second-quarter fiscal 2022 (ended as of Feb 28, 2022), beating the Zacks Consensus Estimate of $1.31. The bottom line increased 22% year over year on solid demand for irrigation equipment.

Lindsay generated revenues of $200 million, up 39% from $144 million reported in the year-ago quarter. The top line surpassed the Zacks Consensus Estimate of $182 million.

The company’s backlog as of Feb 28, 2022, was $111 million compared with $101.4 million witnessed as of Feb 28, 2021.

Operational Update

Cost of operating revenues rose 54% year on year to $157 million. Gross profit was up 5% to $43 million from the year-earlier quarter’s levels. Gross margin came in at 21.5% compared with the year-ago quarter’s 28.6%.

Operating expenses were $25 million during the fiscal second quarter, flat year over year. Operating income was $18 million, up from the prior-year quarter’s $16 million.

Lindsay Corporation Price, Consensus and EPS Surprise

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 52% year over year to around $181 million in the fiscal second quarter. North America irrigation revenues rose 26% from the year-ago quarter’s levels to $101 million, primarily on higher average selling prices. International irrigation revenues soared 108% year over year to $80 million on higher unit sales volumes and higher selling prices. The segment’s operating income increased 37% year on year to $24.7 million.

The Infrastructure segment revenues declined 23% year over year to $19 million on lower Road Zipper System sales and lease revenue. The segment reported an operating income of $0.3 million, down 95% year over year. The downside was caused by lower revenues and a less favorable margin mix of revenues compared with the prior-year quarter’s levels and under absorbed overhead costs.

Financial Position

Lindsay had cash and cash equivalents of nearly $69 million at the end of the fiscal second quarter compared with $111 million in the prior-year quarter’s end. The company’s long-term debt stood at around $115 million at the end of the fiscal second quarter, flat year over year.

Outlook

Lindsay expects to continue witnessing robust demand for irrigation equipment in North America, supported by strong agricultural commodity prices and farm income projections. In the infrastructure business, the company anticipates an increase in project activity in the second half of fiscal 2022. However, raw material cost inflation and supply chain challenges will likely persist in the near term.

Price Performance

Lindsay’s shares have declined 10% in the past year compared with the industry’s growth of 8.3%.

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Zacks Investment Research


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Zacks Rank & Stocks to Consider

Lindsay currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Industrial Products sector are AGCO Corporation AGCO, Packaging Corporation of America PKG and Deere and Company DE. While AGCO flaunts a Zacks Rank #1 (Strong Buy), PKG and DE carries a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

AGCO Corp has an estimated earnings growth rate of around 12% for 2022. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 10.6%.

AGCO pulled off a trailing four-quarter earnings surprise of 56.6%, on average. In the past six months, the company’s shares have gained 13.7%.

Packaging Corp has an expected earnings growth rate of 12.6% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 0.9% in the past 60 days.

PKG has a trailing four-quarter earnings surprise of 22.7%, on average. PKG’s shares have gained 9.9% in the past six months.

Deere has a projected earnings growth rate of 19.7% for the current fiscal. The Zacks Consensus Estimate for fiscal 2022 earnings has moved north by 2.3% in the past 60 days.

DE delivered a trailing four-quarter earnings surprise of 20.6%, on average. Deere has moved up 23.3% in the past six months.


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