Lindblad Expeditions Stock Soars 21.86% Despite Earnings Concerns

Lindblad Expeditions' stock surged by 21.86% in pre-market trading on April 4, 2025, marking a significant rise that has caught the attention of investors and analysts alike.

Lindblad Expeditions, founded by explorer Sven-Olof Lindblad in 1979, offers unique cruising experiences to remote destinations in partnership with National Geographic. However, the company's long-term revenue growth has been disappointing, with sales growing at a 13.4% annual rate over the past five years. This growth rate, while acceptable on an absolute basis, falls short of the standards for the consumer discretionary sector, which benefits from various secular tailwinds.

One of the key concerns for Lindblad Expeditions is the declining earnings per share (EPS). Over the last five years, the company's EPS has decreased by 73% annually, despite a 13.4% increase in revenue. This indicates that the company has become less profitable on a per-share basis as it has expanded. Additionally, analysts predict that Lindblad Expeditions' cash conversion will fall over the next year, with its free cash flow margin of 9.1% for the last 12 months expected to decrease to 5.1%.

Given these fundamentals, Lindblad Expeditions does not pass the quality test. While the stock's recent performance has been strong, the potential downside is significant due to its shaky financials. Investors may want to consider other opportunities in the market that offer more stable and promising returns.