CEO at Lakeland sees shares undervalued
It would seem a company's chief executive would jump for joy if his stock price rose 14 percent in a single day.
Not necessarily. Shares of Ronkonkoma-based Lakeland Industries Inc., a maker of protective garments, rose by that amount Dec. 23, the day an Australian company, Ansell Ltd., purchased more than 500,000 shares of Lakeland, or about 9 percent of its outstanding stock, for $4.4 million.
Shares closed at $8.98 that day. But earlier this week Lakeland chief executive Chris Ryan said in a filing with the Securities and Exchange Commission that the purchase "reflects the undervaluation of the price" of Lakeland's shares.
"Given the foundation we have built for strong worldwide growth, which management expects will be reflected in improved financial performance both near and long term, we believe that our common stock market price does not reflect Lakeland's intrinsic value," Ryan said.
Perhaps. But maybe Ansell looked no further than Lakeland's most recent earnings report, which covered the three months ended Oct. 31. The company said sales fell $1 million from a year earlier to $24.7 million as U.S. sales dropped and overseas sales were unable to fill the gap. Lakeland also reported a $577,000 net loss, compared with a profit of $649,000 a year earlier, citing a charge of $880,000 for discontinuing an unprofitable glove manufacturing facility.
Ryan did not return calls seeking comment.
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