Margins and Exits: A Small Tragedy

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Lindsay Stock Image

Pier Capital, a firm I’m assuming is staffed by people who’ve made peace with the inevitability of quarterly reports, recently offloaded its Lindsay holdings – 71,799 shares, to be precise. That’s about $10.09 million worth of irrigation systems and road safety barriers, which, let’s be honest, is a surprisingly poetic way to spend a fortune. It reminded me of my aunt Mildred, who once sold her Beanie Baby collection for slightly less, convinced she was getting in on the ground floor of some plush-toy renaissance. She wasn’t.

They exited, which is corporate-speak for “we’re done,” or, in my personal translation, “we’ve found a slightly less depressing place to park our money.” It represented 1.58% of their “AUM,” which is another acronym I try to avoid. It’s like a virus. The whole thing feels…transient. Like a particularly well-funded sandcastle.

Their top holdings, as of the last accounting, included MIR, CWAN, HXL, ALHC, and FULT. I’m not sure what any of those are, and I suspect neither do most people involved. It’s all just…letters now. Like a secret code we’re all pretending to understand.

Lindsay shares were down 1.86% over the past year, underperforming the S&P 500. Which, if you think about it, is a remarkable achievement. The S&P 500 is, by default, the least-worst option. To actively underperform that… it takes dedication. It’s like entering a pie-eating contest and only managing to smear a little filling on your chin.

A Brief Overview (Because We Have to)

Metric Value
Revenue (TTM) $665.90 million
Net income (TTM) $73.41 million
Dividend yield 1.1%
Price (as of February 2) $127.27

They make irrigation systems and road barriers. Apparently, people need both. Who knew? They also have brands like Zimmatic, Perrot, Greenfield, and GrowSmart. I suspect those names were focus-grouped to within an inch of their lives. I picture a room full of marketing executives arguing over the merits of “HydroFlow” versus “AquaGuard.” It’s exhausting just thinking about it.

They sell to farmers, highway departments, and contractors. A solid, if unglamorous, business. It’s the kind of company that just…exists. Like a reliable pair of shoes. Or a slightly judgmental librarian.

The real story here isn’t the exit, it’s the fact that they managed to maintain a 12.6% operating margin while everything else was going sideways. Farmers are feeling glum, commodity prices are down, and everyone’s holding onto their wallets, but Lindsay is still squeezing out a profit. It’s…admirable, in a bleak, dystopian sort of way.

They bought back $30 million worth of stock, which is corporate-speak for “we have no better ideas.” They’ve authorized another $150 million, which means they’ll probably keep doing that until someone figures out a more creative way to spend the money. Maybe they’ll commission a giant sculpture of a sprinkler head. I’d pay to see that.

Backlog fell sharply. Apparently, they’ve delivered on some big irrigation projects, which means the good times are temporarily over. It’s a reminder that even the most reliable businesses are subject to the whims of the market. And the weather. And the general unpredictability of human behavior.

Strong margins, a clean balance sheet, and growth in the infrastructure segment are all good signs. But near-term irrigation demand is tied to forces beyond their control. It’s like trying to predict whether your neighbor will finally mow his lawn. You can hope, but you shouldn’t bet on it.

Walking away now might not mean the business is broken. It might just mean they’re tired. And honestly, who can blame them?

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2026-02-06 20:13