Ebola fear causes hazmat-suit maker's biggest one-day jump

Lakeland Industries Inc. shares saw their biggest one-day jump and record-high volume Thursday as global concerns about how to contain the spread of the deadly Ebola virus grow. 

Lakeland (LAKE) surged nearly 53% to close at $17.72 on very heavy volume Thursday. Shares hit an intraday high of $19.79, a level not seen since July 2004. More than 47 million shares changed hands on the session, more than four times its previous record volume high. 

The 52-week average volume on the stock is just over 166,000 shares. Shares are up 155% since the first reported U.S. case of Ebola, and are up 237% on the year. 

Lakeland makes the ChemMax1 protective suit that appears to have taken the forefront in protecting health care workers from the Ebola virus. 

Late Wednesday, the Centers for Disease Control and Prevention said it would start screening passengers at five U.S. airports who come from countries hardest hit by Ebola. On Thursday, came reports that the condition of a nurse's aide in Spain infected with Ebola had worsened, and plane cabin cleaners at New York's La Guardia Airport walked off the job because of safety concerns. 

Lakeland Vice President of International Sales Charles Roberson said the company is "not talking to the media right now" given all that is going on. Last month, the company said the U.S. State Department put out a bid for manufacturers to supply 160,000 suits. 

No analysts have actively covered Lakeland since early 2013, but William Bremer, senior industrial and infrastructure analyst at Maxim Group, said he's doing due diligence into Lakeland and Alpha Pro Tech Ltd.(APT), which also lacks coverage by Wall Street analysts. 

Alpha Pro Tech shares rose 28% to close at $4.84 on volume of nearly 15 million shares, compared with the 52-week average daily volume of 117,000 shares. 

Lakeland and Alpha Pro Tech have a variety of protective suits depending on the environment, but Lakeland does not make a ventilation and filtration system like Alpha Pro's N95 particulate face mask, Bremer said. 

Both companies have remained true to their infectious disease-prevention products since the SARS outbreak in 2002, the analyst said. When there hasn't been heightened awareness of a possible outbreak, those products have saddled performance at the companies. Now, what once has hampered company performance becomes a huge opportunity as demand swells, he added. 

"Pretty much whatever is on the shelf is being utilized," Bremer said. Also, he noted manufacturing lead times are being made more efficient at both companies to meet demand, and that many end markets are checking their inventories and budgets, suggesting worrying are growing over spread of the virus. 

In the quarter ended July 31, Lakeland reported a loss of 7 cents a share on revenue of $24.6 million, flat from the year-ago period. In the quarter ended Oct. 31, 2013, Lakeland posted a loss of 31 cents a share on sales of $22.8 million. 

Lakeland's stock hit an all-time high of $22.78 in April 2004, back when bird flu was breaking out in Asia, causing fears of a pandemic. In that quarter, the company posted a profit of 43 cents a share on revenue of $26.8 million. 


By Wallace Witkowski