LAMB WESTON HOLDINGS INC (LW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LW - US5132721045 - Common Stock
43.94 USD
-15.39 (-25.94%)
43.85 USD
-0.09 (-0.2%)
Overall LW gets a fundamental rating of 5 out of 10. We evaluated LW against 87 industry peers in the Food Products industry. While LW is still in line with the averages on profitability rating, there are concerns on its financial health. LW is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year LW was profitable.
LW had a positive operating cash flow in the past year.
In the past 5 years LW has always been profitable.
In the past 5 years LW always reported a positive cash flow from operatings.
1.2 Ratios
LW has a better Return On Assets (5.35%) than 80.68% of its industry peers.
LW has a Return On Equity of 22.36%. This is amongst the best in the industry. LW outperforms 93.18% of its industry peers.
LW has a better Return On Invested Capital (9.60%) than 86.36% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LW is significantly below the industry average of 28.52%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.35% | ||
| ROE | 22.36% | ||
| ROIC | 9.6% |
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's Profit Margin of 6.06% is fine compared to the rest of the industry. LW outperforms 76.14% of its industry peers.
LW's Profit Margin has declined in the last couple of years.
LW's Operating Margin of 12.44% is amongst the best of the industry. LW outperforms 81.82% of its industry peers.
LW's Operating Margin has declined in the last couple of years.
LW has a Gross Margin of 22.11%. This is comparable to the rest of the industry: LW outperforms 54.55% 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 | 12.44% | ||
| PM (TTM) | 6.06% | ||
| GM | 22.11% |
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
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 less shares outstanding than it did 1 year ago.
LW has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, LW has a worse debt to assets ratio.
2.2 Solvency
LW has an Altman-Z score of 2.55. This is not the best score and indicates that LW is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.55, LW perfoms like the industry average, outperforming 59.09% of the companies in the same industry.
The Debt to FCF ratio of LW is 6.05, which is on the high side as it means it would take LW, 6.05 years of fcf income to pay off all of its debts.
LW has a Debt to FCF ratio of 6.05. This is in the better half of the industry: LW outperforms 76.14% of its industry peers.
LW has a Debt/Equity ratio of 2.19. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.19, LW is doing worse than 86.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.19 | ||
| Debt/FCF | 6.05 | ||
| Altman-Z | 2.55 |
ROIC/WACC1.38
WACC6.93%
2.3 Liquidity
A Current Ratio of 1.43 indicates that LW should not have too much problems paying its short term obligations.
LW has a Current ratio of 1.43. This is comparable to the rest of the industry: LW outperforms 40.91% of its industry peers.
LW has a Quick Ratio of 1.43. 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 has a Quick ratio of 0.64. This is in the lower half of the industry: LW underperforms 68.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.43 | ||
| Quick Ratio | 0.64 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.89% over the past year.
LW shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.09% yearly.
The Revenue has been growing slightly by 2.35% 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)0.89%
EPS 3Y17.33%
EPS 5Y6.09%
EPS Q2Q%4.55%
Revenue 1Y (TTM)2.35%
Revenue growth 3Y16.32%
Revenue growth 5Y11.21%
Sales Q2Q%1.07%
3.2 Future
The Earnings Per Share is expected to grow by 17.25% on average over the next years. This is quite good.
Based on estimates for the next years, LW will show a small growth in Revenue. The Revenue will grow by 3.20% on average per year.
EPS Next Y-7.58%
EPS Next 2Y2%
EPS Next 3Y6.79%
EPS Next 5Y17.25%
Revenue Next Year2.52%
Revenue Next 2Y1.09%
Revenue Next 3Y1.73%
Revenue Next 5Y3.2%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
Based on the Price/Earnings ratio of 12.92, the valuation of LW can be described as correct.
Based on the Price/Earnings ratio, LW is valued a bit cheaper than 76.14% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.39. LW is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 12.57, which indicates a correct valuation of LW.
Based on the Price/Forward Earnings ratio, LW is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
LW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.84.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.92 | ||
| Fwd PE | 12.57 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LW is valued a bit cheaper than the industry average as 68.18% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of LW indicates a rather cheap valuation: LW is cheaper than 88.64% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.45 | ||
| EV/EBITDA | 8.19 |
4.3 Compensation for Growth
LW has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.12
EPS Next 2Y2%
EPS Next 3Y6.79%
5. Dividend
5.1 Amount
LW has a Yearly Dividend Yield of 2.49%. Purely for dividend investing, there may be better candidates out there.
In the last 3 months the price of LW has falen by -21.06%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
LW's Dividend Yield is a higher than the industry average which is at 2.34.
LW's Dividend Yield is a higher than the S&P500 average which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
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.
As LW did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)11.99%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
52.74% 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 earnings are growing more, so the dividend growth is sustainable.
DP52.74%
EPS Next 2Y2%
EPS Next 3Y6.79%
43.94
-15.39 (-25.94%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners91.78%
Inst Owner Change1.47%
Ins Owners2.3%
Ins Owner Change1.6%
Market Cap6.12B
Revenue(TTM)6.47B
Net Income(TTM)392.30M
Analysts75
Price Target64.91 (47.72%)
Short Float %2.88%
Short Ratio2.47
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
Yearly Dividend1.46
Dividend Growth(5Y)11.99%
DP52.74%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)16.49%
Min EPS beat(2)3.04%
Max EPS beat(2)29.94%
EPS beat(4)4
Avg EPS beat(4)22.3%
Min EPS beat(4)3.04%
Max EPS beat(4)33.32%
EPS beat(8)4
Avg EPS beat(8)-1.07%
EPS beat(12)7
Avg EPS beat(12)7.58%
EPS beat(16)11
Avg EPS beat(16)18.21%
Revenue beat(2)0
Avg Revenue beat(2)-0.93%
Min Revenue beat(2)-1.28%
Max Revenue beat(2)-0.58%
Revenue beat(4)1
Avg Revenue beat(4)-0.12%
Min Revenue beat(4)-1.28%
Max Revenue beat(4)2.31%
Revenue beat(8)2
Avg Revenue beat(8)-3.3%
Revenue beat(12)3
Avg Revenue beat(12)-1.97%
Revenue beat(16)5
Avg Revenue beat(16)-1.17%
PT rev (1m)-4.64%
PT rev (3m)-1.85%
EPS NQ rev (1m)-5.6%
EPS NQ rev (3m)-7.28%
EPS NY rev (1m)-2.04%
EPS NY rev (3m)3.88%
Revenue NQ rev (1m)-0.13%
Revenue NQ rev (3m)-0.13%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.92 | ||
| Fwd PE | 12.57 | ||
| P/S | 0.95 | ||
| P/FCF | 9.45 | ||
| P/OCF | 6.32 | ||
| P/B | 3.49 | ||
| P/tB | 11.26 | ||
| EV/EBITDA | 8.19 |
EPS(TTM)3.4
EY7.74%
EPS(NY)3.5
Fwd EY7.96%
FCF(TTM)4.65
FCFY10.59%
OCF(TTM)6.96
OCFY15.83%
SpS46.46
BVpS12.59
TBVpS3.9
PEG (NY)N/A
PEG (5Y)2.12
Graham Number31.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.35% | ||
| ROE | 22.36% | ||
| ROCE | 13.58% | ||
| ROIC | 9.6% | ||
| ROICexc | 9.73% | ||
| ROICexgc | 12.17% | ||
| OM | 12.44% | ||
| PM (TTM) | 6.06% | ||
| GM | 22.11% | ||
| FCFM | 10.01% |
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%
ROICexgc growth 3Y-1.96%
ROICexgc 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-Score7
Asset Turnover0.88
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.19 | ||
| Debt/FCF | 6.05 | ||
| Debt/EBITDA | 3.21 | ||
| Cap/Depr | 82.78% | ||
| Cap/Sales | 4.96% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 81.24% | ||
| Profit Quality | 165.23% | ||
| Current Ratio | 1.43 | ||
| Quick Ratio | 0.64 | ||
| Altman-Z | 2.55 |
F-Score7
WACC6.93%
ROIC/WACC1.38
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)0.89%
EPS 3Y17.33%
EPS 5Y6.09%
EPS Q2Q%4.55%
EPS Next Y-7.58%
EPS Next 2Y2%
EPS Next 3Y6.79%
EPS Next 5Y17.25%
Revenue 1Y (TTM)2.35%
Revenue growth 3Y16.32%
Revenue growth 5Y11.21%
Sales Q2Q%1.07%
Revenue Next Year2.52%
Revenue Next 2Y1.09%
Revenue Next 3Y1.73%
Revenue Next 5Y3.2%
EBIT growth 1Y-2.77%
EBIT growth 3Y22.59%
EBIT growth 5Y8.17%
EBIT Next Year52.45%
EBIT Next 3Y19.83%
EBIT Next 5Y15.58%
FCF growth 1Y727.49%
FCF growth 3Y20.72%
FCF growth 5Y-11.68%
OCF growth 1Y4.36%
OCF growth 3Y27.58%
OCF growth 5Y8.63%
LAMB WESTON HOLDINGS INC / LW FAQ
Can you provide the ChartMill fundamental rating for LAMB WESTON HOLDINGS INC?
ChartMill assigns a fundamental rating of 5 / 10 to LW.
What is the valuation status for LW stock?
ChartMill assigns a valuation rating of 6 / 10 to LAMB WESTON HOLDINGS INC (LW). This can be considered as Fairly Valued.
Can you provide the profitability details for LAMB WESTON HOLDINGS INC?
LAMB WESTON HOLDINGS INC (LW) has a profitability rating of 6 / 10.
What are the PE and PB ratios of LAMB WESTON HOLDINGS INC (LW) stock?
The Price/Earnings (PE) ratio for LAMB WESTON HOLDINGS INC (LW) is 12.92 and the Price/Book (PB) ratio is 3.49.
How financially healthy is LAMB WESTON HOLDINGS INC?
The financial health rating of LAMB WESTON HOLDINGS INC (LW) is 3 / 10.