Ricardo Pillai
3 min read
In This Article:
We came across a bullish thesis on Lakeland Industries, Inc. (LAKE) on Substack by everyonehatespoetry. In this article, we will summarize the bulls’ thesis on LAKE. Lakeland Industries, Inc. (LAKE)'s share was trading at $19.44 as of May 19th. LAKE’s trailing and forward P/E were 77.12 and 14.51 respectively according to Yahoo Finance.
A close-up view of a firefighter handling a large hose, symbolizing the strength and fortitude of these individuals.
Lakeland Fire + Safety (LAKE), formerly Lakeland Industries, is undergoing a transformative shift under CEO Jim Jenkins, evolving from a low-growth PPE manufacturer into a high-potential industrial compounder through a strategic roll-up approach in the fire safety market. Jenkins, an experienced M&A strategist with a proven track record from his time at Transcat, is leveraging the steady, asset-light cash flow from Lakeland’s industrial PPE segment—which boasts 40–50% gross margins—to fund accretive acquisitions in fire protection, an industry benefiting from strong secular tailwinds driven by regulatory changes and evolving safety standards.
Since Jenkins took the helm full-time in May 2024, he has deployed $70 million in acquisitions at an attractive 6x EBITDA multiple, propelling LAKE into the top five global providers of fire safety gear with a comprehensive product suite. Future growth is set to pivot towards high-margin, recurring revenue services like fire gear decontamination, offering 60–70% gross margins, low cyclicality, and strong synergies with manufacturing. The acquisition environment remains favorable, with limited competition and efficient deal sourcing driving value creation.
Supported by a de-risked balance sheet and a successful 2025 equity raise anchored by institutional investors, Lakeland targets $47 million EBITDA by FY29, implying a $470 million enterprise value at a conservative 10x multiple and a potential 160% upside from current share prices. While risks such as tariffs, execution, and dilution exist, these are mitigated by a diversified footprint, disciplined capital allocation, and management’s preference for equity-light deals. Overall, LAKE stands out as a compelling microcap with a clear path to growth, strong leadership, and significant upside potential, mirroring the successful transformation of Transcat under its CEO’s guidance.
Lakeland Industries, Inc. (LAKE) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 11 hedge fund portfolios held LAKE at the end of the fourth quarter which was 8 in the previous quarter. While we acknowledge the risk and potential of LAKE as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than LAKE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
