LSI Industries Snaps Up JSI Store Fixtures For $90M; Street Sees 51.9% Upside

Commercial lighting and graphics solutions provider LSI Industries (LYTS) has acquired JSI Store Fixtures for $90 million from RFE Investment Partners.

JSI provides retail commercial display solutions. Its solutions have seen growth on the back of demand from major supermarket, convenience, and specialty store chains.

LSI President and CEO James A. Clark said, “This acquisition will significantly increase LSI’s total addressable markets within the grocery and convenience store verticals while driving meaningful revenue synergies across our combined product portfolio, consistent with our long-term strategic focus.”

Clark added, “At a commercial level, the combination of LSI’s graphics signage and JSI’s display fixtures businesses, together with our deep portfolio of lighting and program management solutions, will provide a compelling, one-stop value proposition for both new and existing customers.” (See LSI Industries stock analysis on TipRanks)

During the calendar year 2020, JSI generated revenue of $70 million and adjusted EBITDA of $10 million. LSI expects this acquisition to be accretive to its adjusted earnings.

Significantly, this acquisition creates a diversified business of scale, provides a strong platform for growth, and enables the company to capitalize on a multi-year investment cycle in the grocery industry.

Last month, H.C. Wainwright analyst Amit Dayal reiterated a Buy rating on the stock with a $14 price target (70.1% upside potential).

Dayal sees multiple catalysts driving LSI’s future growth. These include nationwide deployment opportunities for the Graphics segment in retail and pharmacy verticals, reorganization of the sales process in the Lighting segment, and an improvement in margins.

The other analyst covering the stock, Roth Capital’s Craig Irwin, also has a Buy rating on the stock with a $11 price target (33.7% upside potential).

The two ratings add up to a Moderate Buy consensus rating alongside a $12.50 price target (51.9% upside potential). Shares have gained about 38.8% over the past year.

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