On Thursday, Roth/MKM increased the price target for Lakeland Industries (NASDAQ:LAKE) shares to $25 from the previous target of $21, while maintaining a Buy rating on the stock.
The adjustment follows Lakeland's recent earnings report, which exceeded expectations due to the company's strategic focus on higher-value industrial and fire-related markets.
The company's performance this past quarter has shown significant strength, surpassing the projections set forth by the analysts.
Lakeland Industries has been actively pursuing organic growth within the range of 8-9%, with additional expansion expected from recent acquisitions.
The firm's ability to integrate these acquisitions seamlessly into its operations is anticipated to contribute to further operating leverage over time.
In light of the strong quarterly results, Lakeland Industries has revised its full-year guidance upward, now expecting adjusted EBITDA to be between $16.8 million and $18.5 million. This forecast includes the potential for additional increases following the integration of the recently acquired LHD Group.
The analyst from Roth/MKM cited the company's consistent delivery of solid financial performance and the successful targeting of lucrative market segments as the basis for the raised price target.
In other recent news, Lakeland Industries commenced fiscal year 2025 on a strong note, reporting a 27% surge in net sales, reaching $36.3 million for the first quarter.
This robust performance was largely driven by the North American and Latin American markets, along with strategic acquisitions and partnerships. The company's gross margins improved to 44.6%, and adjusted EBITDA saw a significant rise of 40% to $3.9 million.
Lakeland Industries also announced the acquisition of LHD Group's fire service business and the development of NFPA Certified Jolly Fire Boots for North America.
Additionally, a strategic partnership with LineDrive is set to expand its distribution network. Despite a decrease in the disposables category as a percentage of sales, disposable sales still grew by 6%.
The company reported a net income of $1.7 million for the quarter, and an $8.6 million decrease in inventory year-over-year due to inventory reduction efforts.
The full-year revenue guidance was raised to $150 million to $155 million, with adjusted EBITDA expected to be between $17 million and $20 million. These are recent developments, indicating a promising trajectory for Lakeland Industries.
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