Lindsay Corp (LNN) recently reported excellent quarterly results, which sent analyst estimates even higher after double-digit revenue growth.
Also, if you are looking to make a play on the red-hot ag sector, this Zacks #1 Rank (Strong Buy) is an excellent candidate.
Company Description
Lindsay Corp primarily makes irrigation equipment for the agricultural markets. Additionally the company offers infrastructure and road safety products through its subsidiaries.
Crushed Estimates
On Oct 20 Lindsay Corp announced fourth-quarter results that included a 19% jump in revenues on a year over year basis. Net earnings nearly tripled, to $6.0 million from $2.1 million.
Earnings per share came in at 48 cents, easily ahead of the Zacks Consensus Estimate of 28 cents. This was the third surprise of the fiscal year; Lindsay Corp met expectations in the second quarter.
Higher Ag Prices, Higher Sales
The company said that purchases for the next agriculture cycle are not due for a few months, but it is now surprise that they expect higher sales given the surging crop prices. Farmers are more optimistic and the USDA is projecting 2010 income to be the fourth highest ever.
If you are looking for a nice play on Ag stocks, Lindsay Corp is a great choice. Recently shares have moved sharply on crop forecasts and rising commodities prices.
Estimates Soar
Even with upward revisions ahead of the report, analysts still raised their outlooks following the excellent results. Forecasts for fiscal 2011 jumped 31 cents on the news, to $2.15.
Forecasts for 2012 are up 37 cents, to $2.52. If Lindsay Corp can hit these targets, annual growth rates will be over 8% this year and another 17% next year.
The Chart
While shares are up dramatically over the past month, the weakening dollar should continue to drive ag prices higher so it is not to late to make a play on LNN.
Bill Wilton is the Aggressive Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Small Cap Trader service
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