LAMB WESTON HOLDINGS INC (LW)
US5132721045 - Common Stock
Overall LW gets a fundamental rating of 6 out of 10. We evaluated LW against 92 industry peers in the Food Products industry. While LW has a great profitability rating, there are quite some concerns on its financial health. LW is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one!
1. Profitability
1.1 Basic Checks
In the past year LW was profitable.
In the past year LW had a positive cash flow from operations.
Each year in the past 5 years LW has been profitable.
Each year in the past 5 years LW had a positive operating cash flow.
1.2 Ratios
LW has a better Return On Assets (15.11%) than 96.70% of its industry peers.
Looking at the Return On Equity, with a value of 62.26%, LW belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
LW has a better Return On Invested Capital (13.11%) than 93.41% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LW is above the industry average of 7.56%.
The 3 year average ROIC (10.33%) for LW is below the current ROIC(13.11%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.11% | ||
| ROE | 62.26% | ||
| ROIC | 13.11% |
ROA(3y)9.29%
ROA(5y)10.21%
ROE(3y)64.45%
ROE(5y)N/A
ROIC(3y)10.33%
ROIC(5y)12.07%
1.3 Margins
LW has a Profit Margin of 16.71%. This is amongst the best in the industry. LW outperforms 92.31% of its industry peers.
LW's Profit Margin has improved in the last couple of years.
LW's Operating Margin of 16.40% is amongst the best of the industry. LW outperforms 92.31% of its industry peers.
LW's Operating Margin has been stable in the last couple of years.
With a decent Gross Margin value of 27.25%, LW is doing good in the industry, outperforming 67.03% of the companies in the same industry.
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 | 16.4% | ||
| PM (TTM) | 16.71% | ||
| GM | 27.25% |
OM growth 3Y3.36%
OM growth 5Y-1.01%
PM growth 3Y25.03%
PM growth 5Y9.29%
GM growth 3Y4.93%
GM growth 5Y1.2%
2. Health
2.1 Basic Checks
LW has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
LW has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, LW has less shares outstanding
LW has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.29 indicates that LW is not in any danger for bankruptcy at the moment.
LW's Altman-Z score of 3.29 is fine compared to the rest of the industry. LW outperforms 76.92% of its industry peers.
LW has a Debt/Equity ratio of 2.11. This is a high value indicating a heavy dependency on external financing.
LW has a Debt to Equity ratio of 2.11. This is amonst the worse of the industry: LW underperforms 89.01% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.11 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.29 |
ROIC/WACC1.61
WACC8.14%
2.3 Liquidity
LW has a Current Ratio of 1.19. This is a normal value and indicates that LW is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.19, LW is not doing good in the industry: 63.74% of the companies in the same industry are doing better.
LW has a Quick Ratio of 1.19. This is a bad value and indicates that LW is not financially healthy enough and could expect problems in meeting its short term obligations.
LW's Quick ratio of 0.52 is on the low side compared to the rest of the industry. LW is outperformed by 76.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.19 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
LW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 33.82%, which is quite impressive.
Measured over the past years, LW shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.88% on average per year.
Looking at the last year, LW shows a very strong growth in Revenue. The Revenue has grown by 36.22%.
The Revenue has been growing by 9.34% on average over the past years. This is quite good.
EPS 1Y (TTM)33.82%
EPS 3Y23.24%
EPS 5Y11.88%
EPS growth Q2Q-16.08%
Revenue 1Y (TTM)36.22%
Revenue growth 3Y12.16%
Revenue growth 5Y9.34%
Revenue growth Q2Q16.33%
3.2 Future
LW is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.45% yearly.
The Revenue is expected to grow by 10.66% on average over the next years. This is quite good.
EPS Next Y22.97%
EPS Next 2Y16.88%
EPS Next 3Y14.1%
EPS Next 5Y12.45%
Revenue Next Year25.06%
Revenue Next 2Y14.26%
Revenue Next 3Y11.21%
Revenue Next 5Y10.66%
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 stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
LW is valuated correctly with a Price/Earnings ratio of 15.18.
Based on the Price/Earnings ratio, LW is valued a bit cheaper than 78.02% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.20, LW is valued a bit cheaper.
A Price/Forward Earnings ratio of 13.06 indicates a correct valuation of LW.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LW indicates a rather cheap valuation: LW is cheaper than 81.32% of the companies listed in the same industry.
LW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.63.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.18 | ||
| Fwd PE | 13.06 |
4.2 Price Multiples
LW's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LW is cheaper than 67.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 11.33 |
4.3 Compensation for Growth
LW's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
LW has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as LW's earnings are expected to grow with 14.10% in the coming years.
PEG (NY)0.66
PEG (5Y)1.28
EPS Next 2Y16.88%
EPS Next 3Y14.1%
5. Dividend
5.1 Amount
LW has a Yearly Dividend Yield of 1.79%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.58, LW pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.44, LW is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.79% |
5.2 History
The dividend of LW has a limited annual growth rate of 5.99%.
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)5.99%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
14.83% of the earnings are spent on dividend by LW. This is a low number and sustainable payout ratio.
The dividend of LW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP14.83%
EPS Next 2Y16.88%
EPS Next 3Y14.1%
LAMB WESTON HOLDINGS INC
NYSE:LW (4/25/2024, 7:04:00 PM)
After market: 83.5 0 (0%)83.5
-1.02 (-1.21%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap12.06B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.79% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.18 | ||
| Fwd PE | 13.06 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.66
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.11% | ||
| ROE | 62.26% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 16.4% | ||
| PM (TTM) | 16.71% | ||
| GM | 27.25% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.9
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.11 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.19 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)33.82%
EPS 3Y23.24%
EPS 5Y
EPS growth Q2Q
EPS Next Y22.97%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)36.22%
Revenue growth 3Y12.16%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y