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Lamb Weston Holdings
(NYSE:LW)
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Rating:65Neutral
Price Target:
$57.00
▲(14.97% Upside)
Action:Reiterated
Date:07/28/26
The score is driven primarily by pressured profitability and elevated leverage despite improving cash flow, which keep the financial profile in the mid-range. Technicals are a supportive positive with the stock trading above major moving averages. Valuation is fair-to-full given a 23.6 P/E, while the earnings call points to cautious improvement (cost savings and North America strength) tempered by international weakness and near-term margin/headwind risks.
Positive Factors
Improved cash generation
Materially stronger operating cash flow and a rebound in free cash flow provide durable financial flexibility. Higher FCF supports investment, debt service, and shareholder returns while reducing refinancing pressure; although FCF has been volatile, the 2026 improvement underpins medium-term balance-sheet repair and optionality.
Negative Factors
Elevated leverage
A debt-heavy capital structure increases sensitivity to earnings volatility and limits strategic flexibility. With net debt/EBITDA reported near mid-3x and meaningful interest expense, downside to margins or a cash-flow hiccup could sharply constrain buybacks, investment cadence, or require accelerated deleveraging steps that weigh on growth plans.
Read all positive and negative factors
Positive Factors
Negative Factors
Improved cash generation
Materially stronger operating cash flow and a rebound in free cash flow provide durable financial flexibility. Higher FCF supports investment, debt service, and shareholder returns while reducing refinancing pressure; although FCF has been volatile, the 2026 improvement underpins medium-term balance-sheet repair and optionality.
Read all positive factors
Lamb Weston Holdings Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Lamb Weston Holdings is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where Lamb Weston Holdings is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyLamb Weston Holdings (LW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.22B
Dividend Yield2.85%
Average Volume (3M)1.73M
Price to Earnings (P/E)25.0
Beta (1Y)0.34
Revenue Growth2.50%
EPS Growth-16.90%
CountryUS
Employees10,100
SectorConsumer Defensive
Sector Strength42
IndustryPackaged Foods
Share Statistics
EPS (TTM)2.10
Shares Outstanding137,481,020
10 Day Avg. Volume2,273,321
30 Day Avg. Volume1,733,000
Financial Highlights & Ratios
PEG Ratio-1.22
Price to Book (P/B)3.24
Price to Sales (P/S)0.89
P/FCF Ratio9.29
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$54.56Price Target Upside10.04% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)3.04
Revenue Forecast (FY)$6.47B
Lamb Weston Holdings Business Overview & Revenue Model
Company Description
Lamb Weston Holdings, Inc. is a prominent global entity specializing in the manufacturing, distribution, and sale of enhanced frozen potato items. Its operations are structured across four distinct segments: Global, Foodservice, Retail, and Other....
How the Company Makes Money
Lamb Weston makes money primarily by manufacturing and selling frozen potato products (most notably frozen French fries) to business-to-business customers and, to a lesser extent, to retail channels. Revenue is generated through (1) Foodservice sa...
Lamb Weston Holdings Earnings Call Summary
Earnings Call Date:Jul 24, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Oct 01, 2026
Earnings Call Sentiment Positive
The call conveys cautious optimism: strong recovery and execution in North America (sustained volume growth, margin expansion, >$100M cost savings in year 1, and robust cash generation) and clear leadership/strategy actions are material positives. However, significant international challenges—particularly in EMEA—input cost volatility from edible oils and freight related to the Middle East conflict, one-time write-offs and start-up costs, and a near-term outlook that includes an expected Q1 EBITDA decline temper near-term upside. Overall the positives (North America performance, cash flow, cost savings, shareholder returns and strategic actions) outweigh the negatives, but with meaningful execution and macro risks to monitor.Positive Updates
Sustained Volume Growth
Six consecutive quarters of volume growth; company Q4 sales volume +7% and full year sales volume +7%. North America Q4 sales volume +11% and full year North America sales volume +9%.
Negative Updates
International (EMEA) Profitability Challenges
International Q4 net sales declined 2% (sales volume -2%, price/mix -4) and full-year international on a constant currency basis net sales were down 4%. EMEA faced competitive pricing pressure and slower demand leading to lower utilization and higher fixed cost absorption.
Read all updates
Q4-2026 Updates
Positive
Negative
Sustained Volume Growth
Six consecutive quarters of volume growth; company Q4 sales volume +7% and full year sales volume +7%. North America Q4 sales volume +11% and full year North America sales volume +9%.
Read all positive updates
Company Guidance
For fiscal 2027 Lamb Weston guided net sales flat to up 1% versus a 52‑week FY26 base of $6.5 billion, adjusted operating income of $720–800 million, adjusted EBITDA $1.1–1.2 billion (vs. $1.13 billion on a 52‑week basis in FY26), adjusted EPS $2.95–3.25 (vs. FY26 $2.90), diluted shares 137.5–139.0 million, interest expense ≈ $190 million, and an effective tax rate of 25.5%–27.5%; cash used for capital expenditures is expected to be ~$380–410 million (accrual basis investments up to $350 million), operating cash flow $750–800 million, net debt $3.8 billion with net debt/adjusted EBITDA 3.4x and ~$1.3 billion available on the revolving facility, and a quarterly dividend of $0.38 per share payable Sept. 4; segment and cadence guidance includes North America comparable net sales flat to up low‑single digits with low‑single digit volume growth and low‑single digit price/mix decline and North America EBITDA flat to up low‑single digits, International top line down low‑single digits with price/mix investment low‑to‑mid single digits and low‑single digit volume growth, International EBITDA improving ~40%–50% as it laps ~$33 million of prior pre‑tax charges, Q1 net sales flat with EBITDA declining in the low‑teens, and continued SG&A reductions and ongoing cost‑savings programs factored into the outlook.Lamb Weston Holdings Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
55
Neutral
Cash Flow
71
Positive
| Breakdown | May 2026 | May 2025 | May 2024 | May 2023 | May 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 6.61B | 6.45B | 6.47B | 5.35B | 4.10B |
| Gross Profit | 1.36B | 1.40B | 1.77B | 1.43B | 832.00M |
| EBITDA | 591.10M | 1.09B | 1.40B | 1.57B | 625.80M |
| Net Income | 290.00M | 357.20M | 725.50M | 1.01B | 200.90M |
Balance Sheet | |||||
| Total Assets | 7.38B | 7.39B | 7.37B | 6.52B | 4.14B |
| Cash, Cash Equivalents and Short-Term Investments | 68.20M | 70.70M | 71.40M | 304.80M | 525.00M |
| Total Debt | 3.94B | 4.16B | 3.85B | 3.49B | 2.75B |
| Total Liabilities | 5.56B | 5.65B | 5.58B | 5.11B | 3.78B |
| Stockholders Equity | 1.82B | 1.74B | 1.79B | 1.41B | 360.50M |
Cash Flow | |||||
| Free Cash Flow | 636.80M | 230.10M | -131.30M | 107.70M | 128.50M |
| Operating Cash Flow | 1.04B | 868.30M | 798.20M | 761.70M | 418.60M |
| Investing Cash Flow | -380.20M | -648.00M | -984.10M | -1.34B | -310.50M |
| Financing Cash Flow | -691.90M | -225.00M | -48.00M | 340.80M | -363.40M |
Lamb Weston Holdings Risk Analysis
Lamb Weston Holdings disclosed 27 risk factors in its most recent earnings report. Lamb Weston Holdings reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lamb Weston Holdings Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $6.27B | 9.44 | 15.33% | 3.23% | -2.21% | 9.29% | |
65 Neutral | $7.22B | 25.02 | 16.12% | 3.03% | 2.50% | -16.90% | |
63 Neutral | $4.14B | 14.04 | 9.40% | ― | 7.16% | 6.00% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
62 Neutral | $6.55B | 10.72 | 15.30% | 7.14% | -2.90% | 33.92% | |
62 Neutral | $12.75B | -91.74 | -2.44% | 3.72% | 3.72% | 88.76% | |
58 Neutral | $6.94B | -3.63 | -24.31% | 9.48% | -2.85% | -265.99% |
* Consumer Defensive Sector Average
LW
Lamb Weston Holdings
53.30
3.03
6.02%
CPB
Campbell Soup
23.05
-7.69
-25.01%
CAG
Conagra Brands
15.01
-2.53
-14.43%
SJM
JM Smucker
119.21
14.55
13.91%
POST
Post Holdings
89.22
-13.22
-12.91%
INGR
Ingredion
103.29
-18.16
-14.96%
Lamb Weston Holdings Corporate Events
Business Operations and StrategyFinancial Disclosures
Lamb Weston to Close Dutch Plant in Efficiency Drive
Negative
Jun 4, 2026
On June 1, 2026, Lamb Weston Holdings, Inc. announced that its Board of Directors had approved a plan to close the company’s manufacturing facility in Broekhuizenvorst, the Netherlands, and begin a required consultation process with the loca...
Business Operations and StrategyPrivate Placements and Financing
Lamb Weston Subsidiary Secures New Long-Term RMB Loan
Positive
May 26, 2026
On May 19, 2026, Ulanqab Lamb Weston Food Co., Ltd., a wholly owned Chinese subsidiary of Lamb Weston Holdings, entered into a new RMB 700 million term loan facility with a syndicate of financial institutions and HSBC Bank (China) Company Limited ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.