Hot Stock to watch: Lindsay Corporation (NYSE: LNN)

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Lindsay Corporation (NYSE: LNN) stock rose 11.3% in this week (Source: Finviz) as the company beaten the earnings estimates for the third quarter of FY 20. LNN’s backlog of unfilled orders as of May 31, 2020 has increased to $78.6 million compared with $52.5 million at May 31, 2019. The company had cash and cash equivalents of $102.4 million at the end of the fiscal third quarter compared with $127 million at the end of the prior fiscal. The company has reported net earnings for the third quarter of $10.1 million compared to net earnings of $2.9 million, for the prior year third quarter.

Meanwhile, during the third quarter Lindsay had completed the acquisition of Net Irrigate, LLC, which is projected to expand the number of irrigated acres managed under the company’s FieldNET platform. In combining Net Irrigate’s market share with the organic growth Lindsay has generated, year-to-date growth in new devices is 200% versus the prior year.

LNN in the third quarter of FY 20 has reported the adjusted earnings per share of 93 cents, beating the analysts’ estimates for the adjusted earnings per share of 80 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 2 percent to $123 million in the third quarter of FY 20, which is in line with the analysts’ estimates for revenue of $123 million. The delays in shipment and project due to COVID-19 impacted revenues by approximately $14 million. Furthermore, higher production costs were partially offset by lower costs in other areas, such as travel and entertainment.

Moreover, Irrigation segment revenues for the third quarter of fiscal 2020 had fallen to $93.5 million, compared to $98.6 million in the same quarter last year. North America irrigation revenues had fallen to $60.9 million compared to $63 million in the same quarter last year. The decline resulted mainly from lower irrigation equipment unit volume, which was partially offset by the impact of higher average selling prices.

In the international irrigation markets, revenues had fallen to $32.6 million compared to $35.6 million in the same quarter last year. Higher volumes in Brazil, and certain other regions were more than offset by unfavorable effects of foreign currency translation of approximately $3.5 million, and COVID-19-related shipment delays of approximately $2 million. The company projects the revenue from these delayed orders to be realized in the fourth quarter. Infrastructure segment revenues for the third quarter of fiscal 2020 rose 32% to $29.6 million due to higher Road Zipper system sales and lease revenues, which were partially offset by lower sales of road safety products in Europe.

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