How Much More Can Lakeland Rise?
Lakeland Industries shares have skyrocketed since the beginning of October as investors take a pessimistic view on recent Ebola news.
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Lakeland Industries Inc. (NASDAQ: LAKE) has skyrocketed since the beginning of October. Investors are taking a pessimistic view on recent Ebola news and hedging their bets that it very well could become a full-blown outbreak or that it could get a lot worse. This speculation has brought on some incredible growth in the share price, but here at 24/7 Wall St we are asking how much higher can this stock stand to go — with an understanding and admission that the answer could still be “exponentially higher” because the firm’s market capitalization is not even quite $100 million.
What investors need to know about Lakeland is that this company has been considered a protective gear and hazmat suit company for years. Its stock has seen major moves over the past decade or more around such national concerns. The most recent announcement is that the company has expanded production capacity to meet growing demand and it announced the global availability of hazmat suits specifically for Ebola.
The recent Ebola scare within the United States has gripped many people with fear, and investors appear to be betting on this as well. Lakeland was well positioned for this, being an international provider of protective clothing, specifically hazmat suits. The company recently said:
With the U.S. State Department alone putting out a bid for 160,000 suits, we encourage all protective apparel companies to increase their manufacturing capacity for sealed seam garments so that our industry can do its part in addressing this threat to global health.
When the first reported case of Ebola was announced in the United States, we saw comparable Ebola-related stocks such as Tekmira, Sarepta and BioCryst take a similar jump on the announcement.
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This stock shot up on October 1 as high as $9.80, 41% higher than the previous close of $6.95. The shares have continued to climb to a high on Thursday to $18.60. Over the course of October, the stock has gained over 150%.
The answer on how much more something can rise is up to you. This company has a market cap of only $96 million. We will not dare try to call a top, nor will we predict that it will fall apart. This company’s sales have been under $100 million but over $90 million for each of the past four years. It is almost a certainty that its new Ebola and existing hazmat suits are being ordered rapidly — the company even telegraphed higher production due to demand.
Lakeland shares have a consensus analyst price target of $7.35 and a 52-week trading range of $4.75 to $18.60. We have included a long-term chart below from BigCharts.com that does include the latest rise as well.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
