- Lamb Weston’s 3rd Quarter adjusted EPS was $1.20, missing the estimate of $1.43.
- The adjusted Ebitda was $343.6 million, falling short of the predicted $387.8 million.
- Net sales were $1.46 billion, lower than the estimated $1.65 billion.
- North America’s net sales were $947.5 million, while international net sales reached $510.8 million.
- Overall volume increased by 12%, despite a forecasted decrease of 6.37%.
- North American volume, however, decreased by 17% while international volume surged by 178%.
- The price/mix was up by 4%, contrary to an estimate of 8.14%.
- North America’s price/mix increased by 5%, and the international price/mix saw a 1% increase.
- The company is aiming for net sales of $1.69 billion to $1.75 billion in the 4th quarter of the fiscal year.
- The expected growth in the 4th quarter is due to a higher price/mix.
- The company plans for an effective tax rate (full year) at the lower end of its targeted range of 23% to 24%.
- The company is targeting an adjusted EBITDA of $350 million to $375 million in the 4th quarter.
- The company expects higher net sales and adjusted gross profit to drive earnings growth, which will be partially offset by adjusted SG&A of $190 million to $195 million.
- The transition to a new ERP system in North America negatively impacted the company’s financial results more than expected.
- Due to the impact of the ERP transition and soft near-term restaurant traffic trends, the company has reduced its annual sales and earnings guidance for the year.
- At present, the company has 14 buys, 0 holds, and 0 sells.
Lamb Weston Holdings on Smartkarma
According to top independent analysts on Smartkarma, Lamb Weston Holdings Inc (LW) has experienced a 30% drop in its stock price since July 2023. This decline has been attributed to market concerns about the potential impact of GLP-1s on consumer consumption and caloric intake behavior, particularly in the greasy fried foods category. However, experts believe that this is an overreaction and presents a good opportunity for investors. Lamb Weston is considered a high-quality business with strong pricing power and long-term earnings growth potential.
The decline in Lamb Weston’s stock price is believed to be a result of misunderstandings. Reports of volume decline and concerns about demand and pricing power are not accurately reflecting the company’s true prospects. This information is sourced from an online content aggregator through publicly available sources and is displayed for general informational purposes only. This article was originally published on Value Investors Club three months ago, highlighting the potential for long-term earnings growth for Lamb Weston Holdings Inc.
A look at Lamb Weston Holdings Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 2 | |
| Growth | 5 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Lamb Weston Holdings, Inc. is a company that produces and supplies frozen potato products. The company has received a Smartkarma Smart Score of 3 out of 5, indicating an overall positive outlook. This score is based on various factors such as value, dividend, growth, resilience, and momentum. While the company received a lower score for value and dividend at 2 out of 5, it scored higher in growth, resilience, and momentum at 5, 2, and 4 respectively.
Based on the Smartkarma Smart Scores, Lamb Weston Holdings is predicted to have a promising long-term outlook. The company’s focus on producing and supplying frozen potato products has led to a strong growth score of 5 out of 5. Additionally, its ability to adapt and withstand challenges, as seen in its resilience score of 2 out of 5, is a positive sign for the company’s future. With a momentum score of 4 out of 5, Lamb Weston Holdings is also showing positive signs for continued growth and success in the frozen potato market.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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