Lamb Weston Q2 adjusted EPS beats estimates

Overview

• Frozen potato supplier's Q2 revenue grew 1%, beating analyst expectations

• Adjusted EPS for Q2 beat analyst expectations

• Company announced 3% increase in quarterly dividend

Outlook

• Company reaffirms fiscal 2026 net sales guidance of $6.35 bln to $6.55 bln

• Company expects fiscal 2026 adjusted EBITDA between $1.00 bln and $1.20 bln

• Company anticipates fiscal 2026 capital expenditures of approximately $500 mln

Result Drivers

• VOLUME GROWTH - Co reported 8% volume increase driven by customer wins and share gains, particularly in North America and Asia

• COST SAVINGS - Lower manufacturing costs per pound in North America due to cost savings initiatives and improved efficiencies

• PRICE/MIX DECLINE - 8% decline in price/mix due to competitive pricing strategies and carryover impact from fiscal 2025 pricing

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 8 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the food processing peer group is "buy."

• Wall Street's median 12-month price target for Lamb Weston Holdings Inc is $66.00, about 11.2% above its December 18 closing price of $59.33

• The stock recently traded at 18 times the next 12-month earnings vs. a P/E of 19 three months ago

Press Release: ID:nBw2Pd68Ga

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