Cruise and exploration company Lindblad Expeditions (NASDAQ:LIND) reported results in line with analysts' expectations in Q2 CY2024, with revenue up 9.4% year on year to $136.5 million. The company's outlook for the full year was also close to analysts' estimates with revenue guided to $620 million at the midpoint. It made a GAAP loss of $0.48 per share, down from its loss of $0.46 per share in the same quarter last year.
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Lindblad Expeditions (LIND) Q2 CY2024 Highlights:
- Revenue: $136.5 million vs analyst estimates of $136.1 million (small beat)
- EPS: -$0.48 vs analyst estimates of -$0.25 (-$0.23 miss)
- The company reconfirmed its revenue guidance for the full year of $620 million at the midpoint
- EBITDA guidance for the full year is $93 million at the midpoint, above analyst estimates of $90.17 million
- Gross Margin (GAAP): 42.4%, up from 37.8% in the same quarter last year
- EBITDA Margin: 7.6%, up from 5% in the same quarter last year
- Free Cash Flow of $11.23 million, down 70% from the previous quarter
- Market Capitalization: $413.1 million
Sven Lindblad, Chief Executive Officer, said "We continued our growth trajectory this quarter with a 9% increase in revenue, demonstrating that more and more people are keen to explore the less traveled destinations and appreciate our dedication to providing our guests unique and valuable travel experiences.
Founded by explorer Sven-Olof Lindblad in 1979, Lindblad Expeditions (NASDAQ:LIND) offers cruising experiences to remote destinations in partnership with National Geographic.
Hotels, Resorts and Cruise Lines
Hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.
Sales Growth
Reviewing a company's long-term performance can reveal insights into its business quality. Any business can have short-term success, but a top-tier one tends to sustain growth for years. Over the last five years, Lindblad Expeditions grew its sales at a mediocre 12.8% compounded annual growth rate. This shows it couldn't expand in any major way and is a tough starting point for our analysis. 
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new property or emerging trend. Lindblad Expeditions's annualized revenue growth of 43.1% over the last two years is above its five-year trend, suggesting its demand recently accelerated. Note that COVID hurt Lindblad Expeditions's business in 2020 and part of 2021, and it bounced back in a big way thereafter.
This quarter, Lindblad Expeditions grew its revenue by 9.4% year on year, and its $136.5 million of revenue was in line with Wall Street's estimates. Looking ahead, Wall Street expects sales to grow 9.5% over the next 12 months.
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Cash Is King
Although earnings are undoubtedly valuable for assessing company performance, we believe cash is king because you can't use accounting profits to pay the bills.
Lindblad Expeditions broke even from a free cash flow perspective over the last two years, giving the company limited opportunities to return capital to shareholders.
Lindblad Expeditions's free cash flow clocked in at $11.23 million in Q2, equivalent to a 8.2% margin. This quarter's cash profitability was in line with the comparable period last year and above its two-year average.
Over the next year, analysts predict Lindblad Expeditions's cash conversion will fall. Their consensus estimates imply its free cash flow margin of 6.7% for the last 12 months will decrease to 4.3%.
Key Takeaways from Lindblad Expeditions's Q2 Results
Revenue beat in the quarter. Full year revenue guidance was reconfirmed, and full year EBITDA guidance was above expectations. Overall, this is a solid quarter . The stock traded up 2.5% to $7.81 immediately after reporting.
So should you invest in Lindblad Expeditions right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.