📊 LW Key Takeaways
Is Lamb Weston Holdings, Inc. (LW) a Good Investment?
Lamb Weston demonstrates solid operational execution with strong free cash flow generation ($375.4M) and excellent interest coverage (35.6x), indicating financial stability despite a significant 50.8% net income decline YoY. However, flat revenue growth combined with margin compression and declining profitability raise concerns about business momentum, suggesting a mature, capital-intensive business facing headwinds.
Lamb Weston's fundamentals are mixed: the business still generates solid operating cash flow and free cash flow, and its interest coverage suggests debt servicing is manageable today. However, flat revenue combined with a roughly 50% drop in net income and EPS points to material pressure on profitability, while elevated leverage and thin net margins reduce balance-sheet flexibility if operating conditions stay weak.
Why Buy Lamb Weston Holdings, Inc. Stock? LW Key Strengths
- Strong free cash flow of $375.4M with 11.5% FCF margin supports debt service and capital allocation flexibility
- Excellent interest coverage ratio of 35.6x indicates very low financial distress risk despite high leverage
- Consistent operating cash generation of $530.4M demonstrates reliable cash earnings despite bottom-line pressure
- Reasonable current ratio of 1.43x provides adequate short-term liquidity coverage
- Strong cash generation with $530.4M in operating cash flow and $375.4M in free cash flow supports resilience
- Interest coverage of 35.6x indicates current earnings still comfortably cover financing costs
- Gross margin of 20.3% and positive operating margin show the core business remains profitable despite earnings pressure
LW Stock Risks: Lamb Weston Holdings, Inc. Investment Risks
- Net income declined 50.8% YoY with diluted EPS down 49.8%, indicating severe profitability deterioration
- Flat revenue growth (0.0% YoY) combined with declining margins suggests loss of pricing power or volume pressure
- High leverage with 2.13x debt/equity ratio and $3.7B long-term debt limits financial flexibility despite strong coverage
- Thin net margin of 3.9% and weak ROE of 7.2% reflect low returns on shareholder capital in a competitive commodity-like industry
- Quick ratio of 0.64x is weak, indicating potential working capital stress and reliance on inventory conversion
- Net income fell 50.8% year over year on flat revenue, indicating weakening earnings quality and margin pressure
- High leverage with 2.13x debt-to-equity and $3.74B of long-term debt increases financial risk
- Low cash balance of $82.7M and a 0.64x quick ratio limit near-term liquidity flexibility if conditions worsen
Key Metrics to Watch
- Quarterly revenue trend and market share dynamics to assess whether flat growth reflects market conditions or company-specific issues
- Operating margin trajectory and gross margin sustainability amid input cost pressures
- Free cash flow sustainability and debt reduction capacity given the current profitability headwinds
- Insider buying/selling patterns given 8 Form 4 filings in last 90 days
- Operating and net margin recovery versus continued revenue stagnation
- Debt reduction progress and sustained free cash flow generation
Lamb Weston Holdings, Inc. (LW) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Lamb Weston Holdings, Inc. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
LW Profit Margin, ROE & Profitability Analysis
LW vs Consumer Sector: How Lamb Weston Holdings, Inc. Compares
How Lamb Weston Holdings, Inc. compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Lamb Weston Holdings, Inc. Stock Overvalued? LW Valuation Analysis 2026
Based on fundamental analysis, Lamb Weston Holdings, Inc. shows some fundamental concerns relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Lamb Weston Holdings, Inc. Balance Sheet: LW Debt, Cash & Liquidity
LW Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Lamb Weston Holdings, Inc.'s revenue has remained relatively flat over the 5-year period, with a 0% decline. The most recent EPS of $6.95 reflects profitable operations.
LW Revenue Growth, EPS Growth & YoY Performance
LW Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $1.5B | $54.0M | $0.39 |
| Q2 2026 | $1.6B | -$36.1M | $-0.25 |
| Q1 2026 | $1.7B | $64.3M | $0.46 |
| Q3 2025 | $1.5B | $146.0M | $1.01 |
| Q2 2025 | $1.6B | -$36.1M | $-0.25 |
| Q1 2025 | $1.7B | $127.4M | $0.88 |
| Q3 2024 | $1.3B | $146.1M | $1.01 |
| Q2 2024 | $1.3B | $103.1M | $0.71 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Lamb Weston Holdings, Inc. Dividends, Buybacks & Capital Allocation
LW SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Lamb Weston Holdings, Inc. (CIK: 0001679273)
📋 Recent SEC Filings
❓ Frequently Asked Questions about LW
What is the AI rating for LW?
Lamb Weston Holdings, Inc. (LW) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 70% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are LW's key strengths?
Claude: Strong free cash flow of $375.4M with 11.5% FCF margin supports debt service and capital allocation flexibility. Excellent interest coverage ratio of 35.6x indicates very low financial distress risk despite high leverage. ChatGPT: Strong cash generation with $530.4M in operating cash flow and $375.4M in free cash flow supports resilience. Interest coverage of 35.6x indicates current earnings still comfortably cover financing costs.
What are the risks of investing in LW?
Claude: Net income declined 50.8% YoY with diluted EPS down 49.8%, indicating severe profitability deterioration. Flat revenue growth (0.0% YoY) combined with declining margins suggests loss of pricing power or volume pressure. ChatGPT: Net income fell 50.8% year over year on flat revenue, indicating weakening earnings quality and margin pressure. High leverage with 2.13x debt-to-equity and $3.74B of long-term debt increases financial risk.
What is LW's revenue and growth?
Lamb Weston Holdings, Inc. reported revenue of $3.3B.
Does LW pay dividends?
Lamb Weston Holdings, Inc. pays dividends, with $103.3M distributed to shareholders in the trailing twelve months.
Where can I find LW SEC filings?
Official SEC filings for Lamb Weston Holdings, Inc. (CIK: 0001679273) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is LW's EPS?
Lamb Weston Holdings, Inc. has a diluted EPS of $0.90.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is LW a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Lamb Weston Holdings, Inc. has a HOLD rating with 70% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is LW stock overvalued or undervalued?
Valuation metrics for LW: ROE of 7.2% (sector avg: 18%), net margin of 3.9% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
Should I buy LW stock in 2026?
Our dual AI analysis gives Lamb Weston Holdings, Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is LW's free cash flow?
Lamb Weston Holdings, Inc.'s operating cash flow is $530.4M, with capital expenditures of $155.0M. FCF margin is 11.5%.
How does LW compare to other Consumer stocks?
Vs Consumer sector averages: Net margin 3.9% (avg: 8%), ROE 7.2% (avg: 18%), current ratio 1.43 (avg: 1.5).
Is Lamb Weston Holdings, Inc. carrying too much debt?
LW has a debt-to-equity ratio of 2.13x, which is above the Consumer sector average of 0.8x. However, the current ratio of 1.43 suggests adequate short-term liquidity.