LAMB WESTON HOLDINGS INC (LW) Stock Fundamental Analysis
NYSE:LW - US5132721045 - Common Stock
56.99 USD
+2.33 (+4.26%)
56.99 USD
0 (0%)
LW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 89 industry peers in the Food Products industry. There are concerns on the financial health of LW while its profitability can be described as average. LW has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
LW had positive earnings in the past year.
LW had a positive operating cash flow in the past year.
In the past 5 years LW has always been profitable.
LW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
LW has a Return On Assets of 4.83%. This is in the better half of the industry: LW outperforms 66.29% of its industry peers.
With an excellent Return On Equity value of 20.56%, LW belongs to the best of the industry, outperforming 89.89% of the companies in the same industry.
With an excellent Return On Invested Capital value of 9.63%, LW belongs to the best of the industry, outperforming 80.90% of the companies in the same industry.
LW had an Average Return On Invested Capital over the past 3 years of 11.49%. This is significantly below the industry average of 29.14%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.83% | ||
| ROE | 20.56% | ||
| ROIC | 9.63% |
ROA(3y)10.05%
ROA(5y)8.51%
ROE(3y)44.21%
ROE(5y)50.9%
ROIC(3y)11.49%
ROIC(5y)10.72%
1.3 Margins
LW has a better Profit Margin (5.54%) than 74.16% of its industry peers.
LW's Profit Margin has declined in the last couple of years.
LW has a Operating Margin of 12.88%. This is in the better half of the industry: LW outperforms 78.65% of its industry peers.
In the last couple of years the Operating Margin of LW has declined.
LW has a Gross Margin of 22.85%. This is comparable to the rest of the industry: LW outperforms 52.81% of its industry peers.
In the last couple of years the Gross Margin of LW has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.88% | ||
| PM (TTM) | 5.54% | ||
| GM | 22.85% |
OM growth 3Y5.39%
OM growth 5Y-2.73%
PM growth 3Y4.15%
PM growth 5Y-10.51%
GM growth 3Y4.02%
GM growth 5Y-0.65%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), LW is creating some value.
LW has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, LW has less shares outstanding
LW has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.68 indicates that LW is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of LW (2.68) is better than 64.04% of its industry peers.
The Debt to FCF ratio of LW is 21.02, which is on the high side as it means it would take LW, 21.02 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 21.02, LW perfoms like the industry average, outperforming 49.44% of the companies in the same industry.
A Debt/Equity ratio of 2.33 is on the high side and indicates that LW has dependencies on debt financing.
With a Debt to Equity ratio value of 2.33, LW is not doing good in the industry: 87.64% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.33 | ||
| Debt/FCF | 21.02 | ||
| Altman-Z | 2.68 |
ROIC/WACC1.33
WACC7.22%
2.3 Liquidity
LW has a Current Ratio of 1.38. This is a normal value and indicates that LW is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.38, LW is in line with its industry, outperforming 42.70% of the companies in the same industry.
LW has a Quick Ratio of 1.38. This is a bad value and indicates that LW is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of LW (0.68) is worse than 66.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.38 | ||
| Quick Ratio | 0.68 |
3. Growth
3.1 Past
LW shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -33.60%.
The Earnings Per Share has been growing slightly by 6.09% on average over the past years.
The Revenue has decreased by -0.25% in the past year.
Measured over the past years, LW shows a quite strong growth in Revenue. The Revenue has been growing by 11.21% on average per year.
EPS 1Y (TTM)-33.6%
EPS 3Y17.33%
EPS 5Y6.09%
EPS Q2Q%11.54%
Revenue 1Y (TTM)-0.25%
Revenue growth 3Y16.32%
Revenue growth 5Y11.21%
Sales Q2Q%3.96%
3.2 Future
The Earnings Per Share is expected to grow by 7.32% on average over the next years.
Based on estimates for the next years, LW will show a small growth in Revenue. The Revenue will grow by 3.29% on average per year.
EPS Next Y5.56%
EPS Next 2Y8.31%
EPS Next 3Y5.17%
EPS Next 5Y7.32%
Revenue Next Year2.04%
Revenue Next 2Y1.45%
Revenue Next 3Y1.79%
Revenue Next 5Y3.29%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 16.96 indicates a correct valuation of LW.
Based on the Price/Earnings ratio, LW is valued a bit cheaper than 66.29% of the companies in the same industry.
When comparing the Price/Earnings ratio of LW to the average of the S&P500 Index (27.24), we can say LW is valued slightly cheaper.
A Price/Forward Earnings ratio of 16.07 indicates a correct valuation of LW.
LW's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. LW is cheaper than 66.29% of the companies in the same industry.
LW is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.82, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.96 | ||
| Fwd PE | 16.07 |
4.2 Price Multiples
LW's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LW is cheaper than 62.92% of the companies in the same industry.
LW's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.42 | ||
| EV/EBITDA | 9.13 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates LW does not grow enough to justify the current Price/Earnings ratio.
LW has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.05
PEG (5Y)2.78
EPS Next 2Y8.31%
EPS Next 3Y5.17%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.70%, LW has a reasonable but not impressive dividend return.
LW's Dividend Yield is a higher than the industry average which is at 4.55.
LW's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
5.2 History
The dividend of LW is nicely growing with an annual growth rate of 11.99%!
LW has been paying a dividend for over 5 years, so it has already some track record.
LW has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)11.99%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
57.92% of the earnings are spent on dividend by LW. This is a bit on the high side, but may be sustainable.
The dividend of LW is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP57.92%
EPS Next 2Y8.31%
EPS Next 3Y5.17%
56.99
+2.33 (+4.26%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners97.7%
Inst Owner Change-9.46%
Ins Owners2.3%
Ins Owner Change0.95%
Market Cap7.94B
Analysts75
Price Target66.14 (16.06%)
Short Float %3.95%
Short Ratio2.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
Yearly Dividend1.46
Dividend Growth(5Y)11.99%
DP57.92%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)28.1%
Min EPS beat(2)22.88%
Max EPS beat(2)33.32%
EPS beat(4)2
Avg EPS beat(4)4.55%
Min EPS beat(4)-36.69%
Max EPS beat(4)33.32%
EPS beat(8)3
Avg EPS beat(8)0.56%
EPS beat(12)7
Avg EPS beat(12)14.38%
EPS beat(16)10
Avg EPS beat(16)16.25%
Revenue beat(2)1
Avg Revenue beat(2)0.68%
Min Revenue beat(2)-0.94%
Max Revenue beat(2)2.31%
Revenue beat(4)2
Avg Revenue beat(4)-0.63%
Min Revenue beat(4)-7.14%
Max Revenue beat(4)3.25%
Revenue beat(8)2
Avg Revenue beat(8)-3.25%
Revenue beat(12)4
Avg Revenue beat(12)-1.4%
Revenue beat(16)5
Avg Revenue beat(16)-1.46%
PT rev (1m)1.73%
PT rev (3m)-0.11%
EPS NQ rev (1m)-29.19%
EPS NQ rev (3m)-29.54%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.9%
Revenue NQ rev (1m)-0.42%
Revenue NQ rev (3m)-0.72%
Revenue NY rev (1m)1.01%
Revenue NY rev (3m)0.84%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.96 | ||
| Fwd PE | 16.07 | ||
| P/S | 1.23 | ||
| P/FCF | 40.42 | ||
| P/OCF | 9.15 | ||
| P/B | 4.57 | ||
| P/tB | 14.89 | ||
| EV/EBITDA | 9.13 |
EPS(TTM)3.36
EY5.9%
EPS(NY)3.55
Fwd EY6.22%
FCF(TTM)1.41
FCFY2.47%
OCF(TTM)6.23
OCFY10.93%
SpS46.3
BVpS12.47
TBVpS3.83
PEG (NY)3.05
PEG (5Y)2.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.83% | ||
| ROE | 20.56% | ||
| ROCE | 14.05% | ||
| ROIC | 9.63% | ||
| ROICexc | 9.74% | ||
| ROICexgc | 12.08% | ||
| OM | 12.88% | ||
| PM (TTM) | 5.54% | ||
| GM | 22.85% | ||
| FCFM | 3.05% |
ROA(3y)10.05%
ROA(5y)8.51%
ROE(3y)44.21%
ROE(5y)50.9%
ROIC(3y)11.49%
ROIC(5y)10.72%
ROICexc(3y)11.82%
ROICexc(5y)11.8%
ROICexgc(3y)14.91%
ROICexgc(5y)14.34%
ROCE(3y)16.55%
ROCE(5y)15.18%
ROICexcg growth 3Y-1.96%
ROICexcg growth 5Y-6.41%
ROICexc growth 3Y-4.75%
ROICexc growth 5Y-7.96%
OM growth 3Y5.39%
OM growth 5Y-2.73%
PM growth 3Y4.15%
PM growth 5Y-10.51%
GM growth 3Y4.02%
GM growth 5Y-0.65%
F-Score5
Asset Turnover0.87
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.33 | ||
| Debt/FCF | 21.02 | ||
| Debt/EBITDA | 3.27 | ||
| Cap/Depr | 164.86% | ||
| Cap/Sales | 10.41% | ||
| Interest Coverage | 3.94 | ||
| Cash Conversion | 70.11% | ||
| Profit Quality | 55.01% | ||
| Current Ratio | 1.38 | ||
| Quick Ratio | 0.68 | ||
| Altman-Z | 2.68 |
F-Score5
WACC7.22%
ROIC/WACC1.33
Cap/Depr(3y)272.82%
Cap/Depr(5y)212.89%
Cap/Sales(3y)13.17%
Cap/Sales(5y)10.29%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-33.6%
EPS 3Y17.33%
EPS 5Y6.09%
EPS Q2Q%11.54%
EPS Next Y5.56%
EPS Next 2Y8.31%
EPS Next 3Y5.17%
EPS Next 5Y7.32%
Revenue 1Y (TTM)-0.25%
Revenue growth 3Y16.32%
Revenue growth 5Y11.21%
Sales Q2Q%3.96%
Revenue Next Year2.04%
Revenue Next 2Y1.45%
Revenue Next 3Y1.79%
Revenue Next 5Y3.29%
EBIT growth 1Y-22.9%
EBIT growth 3Y22.59%
EBIT growth 5Y8.17%
EBIT Next Year50.41%
EBIT Next 3Y18.27%
EBIT Next 5Y14.66%
FCF growth 1Y201.5%
FCF growth 3Y20.72%
FCF growth 5Y-11.68%
OCF growth 1Y8.78%
OCF growth 3Y27.58%
OCF growth 5Y8.63%