Episode Details

Lindsay (LNN) Q3 FY2026 — Revenue fell 5% to $160.8M and EPS slipped to $1.53 as the ag down-cycle pressured irrigation, while infrastructure grew 8% and the MENA project lifted backlog. Lindsay is a rare thing: a net-cash, moat-owning compounder (Zimmatic irrigation + the Road Zipper) aggressively buying back its own stock right through a farm recession. The catch is the price — roughly 23x trough earnings. THE CALL: HOLD (3/5, FULLY VALUED) — base-case value ~$111 vs ~$115 today. KEY METRICS: - Q3 revenue: $160.8M (−5% YoY); diluted EPS $1.53 (vs $1.78); operating margin 11.5% (from 14.0%) - Segments: Irrigation $133.0M (−7%) — NA $61.3M (−11%), Int'l $71.7M (−4%); Infrastructure $27.7M (+8%) - Segment operating margin: Infrastructure 19.5%, Irrigation 15.3%, Consolidated 11.5% - Backlog $136.1M (+$19M YoY), lifted by a ~$70M MENA irrigation project (FY2026 revenue) - Balance sheet: cash $154.8M vs debt $114.9M → net cash ~$40M; low beta (0.71) - Capital return: $80.7M buybacks FYTD, dividend raised to $1.48/yr - Valuation: ~$115 after the post-earnings drop, P/E ~21x; 52-week range $97.27–$149.56 - Peers: Valmont (VMI) +6%/~21x, AGCO ~flat/~14x, Deere (DE) −9%/~28x What to watch: North America farmer sentiment and commodity prices, the Brazil credit picture, and the infrastructure / Road Zipper pipeline Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.