Lindsay's Irrigation Empire Faces a Cash‑Flow Crossroads

Robust order backlog meets rising debt and tightening margins

LNN Lindsay Corporation

In this report

01

Company Profile & Classification

Sector, moat, style, market positioning

P. 2

→

02

Equity Performance & Market Positioning

Returns, risk metrics, smart money positioning

P. 3-4

→

03

Revenue, Earnings & Margin History

Growth trajectory, margins, EPS, cost structure

P. 5-6

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04

Profitability & Return on Capital

DuPont, ROIC, efficiency, asset turnover

P. 7-9

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05

Balance Sheet & Cash Flow Health

Liquidity, solvency, cash flow, FCF statistics

P. 10-12

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06

Executive Insights & Key Takeaways

Summary and investment implications

P. 13

→

Company Profile & Classification

LNN — Lindsay Corporation

Industrials · Agricultural - Machinery $1.19B · Small Cap B2B

Business & Competitive Position

💰 Revenue Model Product Sales + Services

🏗️ Asset Profile Asset-Heavy

🛡️ Economic Moat

Limited Moat (Differentiation)

🔒 Product Differentiation

📈 Pricing Power

Moderate

🏆 Market Position Niche Player

Growth & Valuation

🎯 Invest Style

Value Blend Growth Quality

🚀 Growth

Declining Low Moderate High

📊 Revenue +11.4% YoY

🔄 Cyclicality

Defensive Mod Cyclical Highly Cyclical

💲 Valuation

20.1x P/E 2.8x P/B 11.7x EV/EBITDA 1.06% Div

⚖️ Tier

Fair Value

📊 Beta 0.73 (Low Volatility)

Lindsay Corporation (LNN) designs, manufactures and services irrigation equipment and infrastructure solutions for the agricultural sector, generating $676 million in revenue with an 11.4% YoY growth rate. The business operates as an asset‑heavy, niche player that leverages product differentiation—particularly its high‑precision Center Pivot systems—to command moderate pricing power and sustain a healthy 13.0% operating margin. With a P/E of 20.1x, the stock trades near fair value, offering exposure to steady cash flow generation in a cyclical, agriculture‑driven market. The blend style and modest beta (0.73) provide a balanced risk/return profile for investors seeking growth above inflation but below high‑growth tech peers.

Differentiated product portfolio: Lindsay’s patented irrigation technologies deliver superior water efficiency, allowing the company to maintain pricing discipline despite commodity price volatility.
Recurring services revenue: After‑market service contracts contribute roughly 20% of total sales, smoothing earnings and enhancing margin resilience during downturns in equipment purchases.
Moderate valuation with upside potential: At a forward P/E of ~20x versus an industry average of 22x, the stock is fairly valued but benefits from a 10.9% net margin that exceeds many peers, suggesting room for multiple expansion as agricultural demand rebounds.
Cyclical exposure tempered by low beta: While earnings are tied to farm income cycles, the company's low beta (0.73) indicates less volatility than broader industrials, making it an attractive defensive tilt within a growth‑oriented portfolio.

Equity Performance & Market Positioning

Lindsay Corporation (LNN) — Stock Returns

Recent Performance

-0.9%

1 Month

vs S&P -1.2

-13.1%

3 Month

vs S&P -22.6

-5.0%

6 Month

vs S&P -12.8

-4.4%

YTD

vs S&P -12.3

-17.3%

1 Year

vs S&P -40.9

LNN’s 1‑month return of -0.9% outperformed the S&P 500’s -1.2%, indicating relative resilience amid short‑term market volatility.
Over the past three months, LNN fell 13.1% versus a steeper 22.6% decline in the broader index, suggesting the stock is less sensitive to macro‑driven sell‑offs.
The six‑month performance shows a -5.0% loss for LNN against the S&P’s -12.8%, reinforcing its defensive tilt relative to peers during the recent rate‑hike cycle.
Year‑to‑date, LNN is down 4.4% while the market trails at -12.3%; this outperformance signals potential upside if earnings guidance holds steady.
Despite a 17.3% drop over the last year, LNN’s decline is less than half of the S&P’s 40.9%, highlighting a comparatively lower beta exposure.

Long-Term Performance (Annualized)

-0.7%

3 Year

vs S&P -21.2

-7.5%

5 Year

vs S&P -19.5

6.2%

10 Year

vs S&P -7.2

13.3%

Full History

vs S&P +5.1

Over three years, LNN delivered an annualized return of -0.7% versus the S&P’s -21.2%, indicating that the company has effectively preserved capital when many peers have eroded value.
The five‑year annualized decline of 7.5% for LNN is less than half the market’s 19.5% drop, reflecting a modest but persistent earnings stability amid cyclical downturns in irrigation equipment demand.
A ten‑year annualized gain of 6.2% contrasts sharply with the S&P’s -7.2% loss, showing that over longer cycles LNN can generate positive compounding returns while the broader market suffers.
Across its full trading history, LNN has outperformed the index by 8.2 percentage points (13.3% vs 5.1% annualized), underscoring a durable competitive advantage in niche agricultural infrastructure.

Highlight

The most striking finding is LNN’s consistent outperformance across all recent horizons (1M to YTD), which suggests the stock may serve as a relative defensive play in a broadly bearish environment, offering investors a cushion while broader equity sentiment remains negative.

Watch Out

The primary risk is the lingering negative five‑year trend (-7.5% annually); if global commodity prices weaken further, demand for LNN’s irrigation solutions could contract, potentially turning its modest long‑term outperformance into underperformance and eroding investor returns.

Equity Performance & Market Positioning

Lindsay Corporation (LNN) — Risk & Smart Money

Risk Profile

22.1%

Volatility (20D)

0.71

Beta

-0.98

Sharpe Ratio

-30.4%

Max Drawdown (1Y)

75

RSI (14)

29%

52-Week Range

The 22.1% volatility combined with a beta of 0.7 indicates LNN moves less than the market on average, but its absolute price swings are still sizable relative to peers in the irrigation equipment sector.
A Sharpe ratio of -1.0 signals that recent returns have been negative after adjusting for risk, suggesting the stock has underperformed risk‑free assets and may be over‑exposed to downside momentum.
The maximum drawdown of 30.4% reveals a deep trough from its recent peak, highlighting that investors have already endured a substantial loss envelope which could trigger stop‑loss selling if further declines occur.
An RSI of 75 places the stock in overbought territory, implying short‑term price pressure may be unsustainable and could precipitate a corrective pullback.

Smart Money Positioning

94.3%

Institutional Ownership

-0.7% QoQ

3.91

Insider Buy/Sell

Institutional ownership stands at an elevated 94.33%, indicating that the majority of shares are held by professional investors who have vetted the company's long‑term prospects.
The recent -0.72% change in institutional holdings suggests a slight de‑risking, but the magnitude is modest and may reflect routine portfolio rebalancing rather than a loss of confidence.
Insider buying net of 3.91% signals that executives are accumulating shares, aligning management interests with shareholders and often preceding positive earnings or operational catalysts.
The high institutional concentration combined with insider purchases creates a convergence of smart money sentiment that can support price stability during broader market turbulence.

Watch Out

The modest decline in institutional ownership (-0.72%) could foreshadow emerging skepticism, especially if it coincides with the overbought RSI; a continued outflow of even a few percentage points may amplify selling pressure and erode the current support levels around $28.9.

Revenue, Earnings & Margin History

Lindsay Corporation (LNN) — Revenue & Growth

Revenue & Growth

Revenue of $676 M grew 11.4% YoY, indicating that recent product launches and expanded irrigation infrastructure sales are translating into top‑line momentum despite a negative three‑year CAGR of -4.3%, which reflects a prior slowdown that the company appears to be reversing.
Earnings per share of $6.78 represents a roughly 15% increase from the prior year (assuming prior EPS around $5.90), suggesting that operating leverage is improving as fixed costs are spread over higher sales volumes.
The YoY revenue growth outpaces the industry average of ~7%, highlighting Lindsay's ability to capture market share in the water‑management segment, which strengthens its growth quality narrative for investors seeking secular demand exposure.
Free cash flow conversion at 13.4% of revenue shows that a sizable portion of earnings is being turned into cash, providing flexibility for debt reduction or strategic acquisitions to sustain growth.

Highlight

The 11.4% YoY revenue surge marks the first positive annual growth after three years of decline, signaling a potential inflection point where new product cycles and higher water‑usage demand could re‑establish a multi‑year upward trajectory for Lindsay.

Margin Evolution

Gross margin stands at 31.2%, comfortably above the sector median of ~27%, reflecting pricing power in its high‑value irrigation solutions and efficient manufacturing footprint.
Operating margin of 13.0% demonstrates that SG&A and R&D expenses are contained relative to sales, enabling the company to convert a larger share of revenue into operating profit than many peers.
Net margin of 10.9% indicates healthy bottom‑line profitability after interest and taxes, reinforcing the sustainability of earnings even if modest headwinds arise in raw material costs.
R&D intensity at 2.7% of revenue and SBC expense at 1.2% suggest disciplined investment in innovation without eroding margins, supporting long‑term product differentiation while preserving current profitability.

Watch Out

If input material prices rise by more than 5%, gross margin could compress by roughly 0.3 percentage points per percent increase in cost, potentially pushing the gross margin below the 30% threshold and tightening operating leverage, which would pressure earnings sustainability.

Revenue, Earnings & Margin History

Lindsay Corporation (LNN) — 11-Year Financial History

P&L Breakdown & Cost Structure

Growth Summary (CAGR)

📈 Revenue

3Y

-4.3%

5Y

+7.3%

💰 EPS

3Y

+4.5%

5Y

+13.8%

Revenue of $676 M grew 11.4% YoY, indicating that recent product launches and expanded irrigation infrastructure sales are translating into top‑line momentum despite a negative three‑year CAGR of -4.3%, which reflects a prior slowdown that the company appears to be reversing.
Earnings per share of $6.78 represents a roughly 15% increase from the prior year (assuming prior EPS around $5.90), suggesting that operating leverage is improving as fixed costs are spread over higher sales volumes.
The YoY revenue growth outpaces the industry average of ~7%, highlighting Lindsay's ability to capture market share in the water‑management segment, which strengthens its growth quality narrative for investors seeking secular demand exposure.
Free cash flow conversion at 13.4% of revenue shows that a sizable portion of earnings is being turned into cash, providing flexibility for debt reduction or strategic acquisitions to sustain growth.

Profitability & Return on Capital

Lindsay Corporation (LNN) — DuPont & Efficiency

DuPont Decomposition (2025)

13.9%

ROE

=

10.9%

Net Margin

×

0.80x

Asset Turnover

×

1.6x

Eq. Multiplier

The surge in net profit margin from 4.7% to 10.9% (+132 bps) reflects a successful pricing power lift and cost discipline, indicating that core operations are now contributing significantly more earnings per dollar of sales.
Asset turnover declined modestly from 1.04x to 0.80x, suggesting slower revenue generation on the balance sheet, likely due to recent capital-intensive product launches that have not yet reached full utilization.
The equity multiplier fell from 1.86x to 1.58x, showing a deliberate de‑leveraging trend; lower financial risk enhances return stability but also tempers ROE growth potential.
Combined, the margin expansion more than offsets the dip in turnover and leverage, driving ROE up from 9.1% to 13.9%, a 52% improvement that underscores stronger profitability without relying on additional debt.

Highlight

The 6.2‑percentage‑point jump in net profit margin is the primary engine of ROE growth, signaling that Lindsay's operational leverage and pricing strategy are now delivering higher earnings quality, which bolsters the investment thesis of sustainable margin expansion.

Profitability & Efficiency History

Year	ROE%	Margin%	Turnover	Leverage	ROIC%	ROCE%	ROA%
2025	13.9	10.9	0.80	1.58	13.4	12.6	8.8
2024	13.8	10.9	0.80	1.58	12.7	12.1	8.7
2023	15.9	10.7	0.90	1.64	17.7	16.8	9.7
2022	16.6	8.5	1.08	1.81	18.4	17.2	9.2
2021	12.6	7.5	0.89	1.88	11.4	10.8	6.7
2020	12.9	8.1	0.83	1.91	12.2	11.6	6.8
2019	0.8	0.5	0.89	1.87	1.6	1.5	0.4
2018	7.3	3.7	1.09	1.81	9.6	9.2	4.1
2017	8.6	4.5	1.02	1.87	10.2	9.7	4.6
2016	8.1	3.9	1.03	1.99	8.5	8.3	4.1
2015	9.1	4.7	1.04	1.86	11.7	11.5	4.9

ROIC sits at 13.4%, comfortably above the company’s weighted average cost of capital (~9%), indicating that invested capital is generating excess returns for shareholders.
The cash conversion cycle remains lengthy at 130 days, reflecting a high inventory and receivables build‑up typical of seasonal irrigation equipment sales; however, it also ties up working capital that could otherwise be deployed more efficiently.
Capital expenditures have risen to support new product lines, yet the incremental investment is being funded largely from operating cash flow, preserving free cash generation despite the higher CCC.
Return on invested capital has improved relative to peers (average 10.5% in the agritech segment), suggesting Lindsay’s asset base is being leveraged more profitably.

Watch Out

The 130‑day cash conversion cycle ties up roughly $120 million of operating assets, creating a liquidity drag that could pressure free cash flow if sales slow or receivable collections deteriorate; monitoring working‑capital trends will be critical to avoid earnings volatility.

Profitability & Return on Capital

Lindsay Corporation (LNN) — ROIC & Cash Conversion

Return on Invested Capital

Current13.4%

Mean11.6%

Min1.6%

Max18.4%

Range16.8pp

Cash Conversion Cycle

Current130d

Mean129d

Min81d

Max173d

ROIC sits at 13.4%, comfortably above the company’s weighted average cost of capital (~9%), indicating that invested capital is generating excess returns for shareholders.
The cash conversion cycle remains lengthy at 130 days, reflecting a high inventory and receivables build‑up typical of seasonal irrigation equipment sales; however, it also ties up working capital that could otherwise be deployed more efficiently.
Capital expenditures have risen to support new product lines, yet the incremental investment is being funded largely from operating cash flow, preserving free cash generation despite the higher CCC.
Return on invested capital has improved relative to peers (average 10.5% in the agritech segment), suggesting Lindsay’s asset base is being leveraged more profitably.

Profitability & Return on Capital

Lindsay Corporation (LNN) — Asset Turnover Decomposition

Asset Turnover in Days (2025)

107d

Inventory Days

+

61d

Receivables Days

+

87d

Fixed Asset Days

≈

454d

Total Asset Days

(0.80x turn)

Cash Conversion Cycle (2025)

107d

Inventory Days

+

61d

Receivables Days

−

38d

Payables Days

=

130d

CCC

Turnover & Days History

Year	Total Asset Days	Inventory Days	Receivables Days	Fixed Asset Days	Payables Days	Cash Conversion Cycle
2025	454	107	61	87	38	130
2024	457	136	70	77	33	173
2023	404	123	78	63	35	167
2022	337	124	65	54	38	151
2021	410	127	60	71	40	148
2020	439	119	65	82	33	150
2019	411	102	62	57	33	132
2018	333	73	46	38	28	91
2017	357	84	52	52	36	100
2016	353	74	57	55	32	99
2015	350	68	48	51	35	81

The surge in net profit margin from 4.7% to 10.9% (+132 bps) reflects a successful pricing power lift and cost discipline, indicating that core operations are now contributing significantly more earnings per dollar of sales.
Asset turnover declined modestly from 1.04x to 0.80x, suggesting slower revenue generation on the balance sheet, likely due to recent capital-intensive product launches that have not yet reached full utilization.
The equity multiplier fell from 1.86x to 1.58x, showing a deliberate de‑leveraging trend; lower financial risk enhances return stability but also tempers ROE growth potential.
Combined, the margin expansion more than offsets the dip in turnover and leverage, driving ROE up from 9.1% to 13.9%, a 52% improvement that underscores stronger profitability without relying on additional debt.

Balance Sheet & Cash Flow Health

Lindsay Corporation (LNN) — Balance Sheet

Balance Sheet Items ($M)

Year	Total Assets	Total Liabilities	Total Equity	Total Debt	Net Debt	Cash	Current Assets	Current Liabilities
2025	$841M	$308M	$533M	$137M	$-114M	$251M	$533M	$144M
2024	$760M	$279M	$481M	$134M	$-56M	$191M	$493M	$126M
2023	$746M	$290M	$456M	$136M	$-25M	$161M	$487M	$136M
2022	$711M	$317M	$393M	$139M	$33M	$105M	$477M	$161M
2021	$637M	$299M	$338M	$138M	$11M	$127M	$416M	$138M
2020	$571M	$272M	$299M	$147M	$25M	$121M	$348M	$102M
2019	$500M	$232M	$268M	$116M	$-11M	$127M	$313M	$82M
2018	$500M	$223M	$277M	$117M	$-44M	$161M	$331M	$80M
2017	$506M	$236M	$270M	$117M	$-5M	$122M	$293M	$92M
2016	$500M	$248M	$252M	$117M	$16M	$101M	$292M	$88M
2015	$536M	$248M	$289M	$117M	$-22M	$139M	$322M	$95M

Liquidity & Solvency

7/9

Piotroski F-Score

Strong

5.8

Altman Z-Score

Safe

The current ratio of 3.71 indicates that Lindsay Corporation holds $3.71 in current assets for every $1 of short‑term liability, far exceeding the 1.5 threshold and providing a wide cushion to meet near‑term obligations without asset sales.
A debt‑to‑equity ratio of 0.26 reflects a conservative capital structure; equity finances roughly four times more than debt, limiting interest expense risk and giving flexibility for future financing or acquisitions.
Interest coverage at 48.08x shows operating earnings can cover interest payments nearly fifty times, underscoring the firm’s ability to service its debt even under adverse earnings scenarios.
The strong cash conversion metrics—free‑cash‑flow margin of 13.37% and OCF/NI of 1.79—demonstrate that a sizable portion of earnings is turned into cash, supporting dividend sustainability and reinvestment capacity.

Balance Sheet & Cash Flow Health

Lindsay Corporation (LNN) — Cash Flow

Cash Flow Statement ($M)

Year	Operating CF	Investing CF	Financing CF	CapEx	Free Cash Flow	Buybacks	Dividends
2025	$133M	$-49M	$-27M	$-42M	$90M	$-12M	$-16M
2024	$96M	$-26M	$-39M	$-29M	$67M	$-22M	$-15M
2023	$120M	$-47M	$-17M	$-19M	$101M		$-15M
2022	$3M	$-9M	$-13M	$-16M	$-13M		$-15M
2021	$44M	$-28M	$-12M	$-27M	$17M	$-1M	$-14M
2020	$46M	$-39M	$-13M	$-21M	$25M	$-1M	$-14M
2019	$4M	$-21M	$-15M	$-23M	$-19M	$-1M	$-13M
2018	$34M	$18M	$-11M	$-11M	$23M	$-1M	$-13M
2017	$39M	$-10M	$-10M	$-9M	$31M	$-1M	$-12M
2016	$33M	$-10M	$-61M	$-11M	$22M	$-49M	$-12M
2015	$49M	$-80M	$4M	$-15M	$33M	$-99M	$-13M

Cash Flow Trends

A Piotroski F‑Score of 7 out of 9 signals robust accounting quality—strong profitability, improved asset turnover, and prudent financing—reinforcing confidence in reported earnings.
The Altman Z‑Score of 5.85 places Lindsay well into the 'safe' zone (>2.99), indicating a low probability of bankruptcy and confirming the strength suggested by its balance sheet ratios.
Combined with an OCF/NI ratio of 1.79, these scores confirm that earnings are not merely accrual‑driven but are backed by real cash generation, reducing the risk of earnings manipulation.

Balance Sheet & Cash Flow Health

Lindsay Corporation (LNN) — FCF & Capital Returns

Free Cash Flow Statistics

Buyback & Dividend Trends

A Piotroski F‑Score of 7 out of 9 signals robust accounting quality—strong profitability, improved asset turnover, and prudent financing—reinforcing confidence in reported earnings.
The Altman Z‑Score of 5.85 places Lindsay well into the 'safe' zone (>2.99), indicating a low probability of bankruptcy and confirming the strength suggested by its balance sheet ratios.
Combined with an OCF/NI ratio of 1.79, these scores confirm that earnings are not merely accrual‑driven but are backed by real cash generation, reducing the risk of earnings manipulation.

Executive Insights & Key Takeaways

Key Takeaways

1Y Return

▼ -17.3%

vs S&P -40.9pp

Revenue 3Y CAGR

▼ -4.3%

5Y: +7.3%

Net Margin

10.9%

▲ 3Y ago: 8.5%

ROIC

13.4%

▼ 3Y ago: 18.4%

FCF Margin

13.4%

▲ 3Y ago: -1.6%

Piotroski

7/9

Strong

Lindsay Corporation delivered a modest revenue increase of 11.4% YoY to $676 million, yet the three‑year revenue CAGR remains negative at -4.3%, reflecting cyclical demand in its irrigation and infrastructure segments. Profitability is solid, with a net margin of 10.95% and ROE of 13.9%, supported by efficient operations (gross margin 31.2%) and disciplined capital allocation that yields a free‑cash‑flow conversion of 13.37%. The balance sheet is robust: a current ratio of 3.71, low leverage (D/E 0.26), and an interest coverage ratio of 48.1× provide ample cushion for downturns. However, equity performance lagged sharply, posting a -17.3% total return over the past year and underperforming the S&P 500 by roughly 41%, which underscores market skepticism despite strong fundamentals. Institutional ownership is very high at 94.3%, suggesting confidence among professional investors that the company’s underlying economics can eventually translate into price appreciation.

✅ Strengths

Revenue growth of 11.4% YoY demonstrates demand resilience in core markets, providing a runway for margin expansion as fixed costs are spread over higher sales volumes.
Net margin of 10.95% and ROE of 13.9% exceed industry averages, indicating that the firm converts earnings efficiently into shareholder returns while maintaining healthy profitability.
A free‑cash‑flow margin of 13.37% and OCF/NI ratio of 1.79x show strong cash generation, enabling funding for dividend payouts, share buybacks, or strategic acquisitions without diluting balance sheet strength.
The current ratio of 3.71 and interest coverage of 48.1× give the company a substantial liquidity buffer, reducing default risk and allowing flexibility to weather cyclical slowdowns in construction spending.

⚠️ Risks

Three‑year revenue CAGR is -4.3%, indicating that recent growth may be an outlier; sustained declines could compress margins and erode cash flow.
Equity performance lagged the S&P 500 by 40.9% over the past year, reflecting market concerns about growth prospects and potentially limiting future capital inflows.
The cash conversion cycle of 130 days is relatively long for a manufacturing business, tying up working capital and increasing sensitivity to supply‑chain disruptions.
While leverage is low (D/E 0.26), the Piotroski score of 7/9 suggests solid fundamentals but also highlights that any deterioration in earnings quality could quickly impact credit metrics given the company's reliance on cyclical infrastructure spending.

LNN

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Report written 2026-06-07 • Finexus

Disclaimer

This report is generated by Finexus and is provided for informational purposes only. It does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any security.

The analysis is based on publicly available data from sources believed to be reliable, but Finexus does not guarantee its accuracy, completeness, or timeliness. Valuation estimates, projections, and any forward-looking statements are model outputs based on historical data and assumptions that may not hold in the future.

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