Stock Analysis

Earnings Beat: Lakeland Industries, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

  •  Updated
NasdaqGM:LAKE
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As you might know, Lakeland Industries, Inc. (NASDAQ:LAKE) just kicked off its latest third-quarter results with some very strong numbers. Statutory revenue and earnings both blasted past expectations, with revenue of US$41m beating expectations by 21% and earnings per share (EPS) reaching US$1.14, some 115% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Lakeland Industries after the latest results.

Check out our latest analysis for Lakeland Industries

earnings-and-revenue-growth
NasdaqGM:LAKE Earnings and Revenue Growth December 13th 2020

Taking into account the latest results, the current consensus, from the two analysts covering Lakeland Industries, is for revenues of US$134.1m in 2022, which would reflect a considerable 11% reduction in Lakeland Industries' sales over the past 12 months. Statutory earnings per share are expected to crater 52% to US$1.73 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$130.9m and earnings per share (EPS) of US$1.20 in 2022. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a considerable lift to earnings per share in particular.

It will come as no surprise to learn that the analysts have increased their price target for Lakeland Industries 15% to US$31.50on the back of these upgrades.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with the forecast 11% revenue decline a notable change from historical growth of 7.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 10% next year. It's pretty clear that Lakeland Industries' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Lakeland Industries' earnings potential next year. They also upgraded their revenue estimates for next year, even though sales are expected to grow slower than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Lakeland Industries. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Lakeland Industries going out as far as 2022, and you can see them free on our platform here.

You still need to take note of risks, for example - Lakeland Industries has 1 warning sign we think you should be aware of.

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What are the risks and opportunities for Lakeland Industries?

Lakeland Industries, Inc. manufactures and sells industrial protective clothing and accessories for the industrial and public protective clothing market worldwide.

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Rewards

  • Earnings are forecast to grow 111.62% per year

Risks

  • Profit margins (2%) are lower than last year (14.8%)

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Lakeland Industries

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