Benchmark maintains Buy on Lancaster Colony, reiterates $185 target

On Tuesday, Benchmark analysts, led by Todd Brooks, maintained a Buy rating on Lancaster Colony (NASDAQ:LANC) stock, with a steady price target of $185.00. Currently trading at $164, the stock sits near its 52-week low of $156.14, while InvestingPro analysis indicates the stock is fairly valued. The affirmation came after a fireside chat with the company’s senior management team, which included insights into the company’s growth strategy and operational efficiencies.

The management team, including CEO Dave Ciesinski, CFO Tom Pigott, and Treasurer Dale Ganobsik, shared their perspectives on driving revenue growth, particularly through the expansion of licensed branded products. With current annual revenue of $1.89 billion and a healthy gross profit margin of 23.7%, they also discussed expectations for further margin improvements, crediting recent acquisitions such as the Atlanta sauce and dressing facility for contributing to operational efficiencies. InvestingPro data reveals the company maintains strong financial health with more cash than debt on its balance sheet.

These insights have led Benchmark to raise their financial year 2025 and 2026 estimates for Lancaster Colony slightly. The analysts expressed continued confidence in the company’s stock, reiterating their $185 price target. The company has demonstrated remarkable stability, maintaining dividend payments for 55 consecutive years, with a current yield of 2.32%.

Lancaster Colony’s strategy focuses on controlling key drivers of revenue growth, and management’s outlook suggests a positive trajectory for margin enhancement. The company’s recent acquisition in Atlanta is seen as a step towards achieving these goals, reinforcing Benchmark’s optimistic stance on the stock.

Benchmark’s reiteration of the Buy rating and price target underscores the firm’s belief in Lancaster Colony’s potential for sustained growth and profitability. The company’s efforts to expand its branded product lines and improve margins appear to align with the analysts’ expectations for the company’s financial performance in the coming years.

In other recent news, Lancaster Colony Corporation reported its financial results for the third quarter of 2025, revealing a decline in both earnings per share (EPS) and revenue compared to forecasts. The company posted an EPS of $1.49, falling short of the expected $1.58, and revenue reached $457.84 million against a forecast of $483.95 million. Despite these challenges, Lancaster Colony achieved a record gross profit of $106 million, demonstrating strong operational efficiency. The company’s gross margin improved by 90 basis points to 23.1%, reflecting effective cost management. Lancaster Colony remains debt-free, holding $124.6 million in cash, which positions it well for future investments and acquisitions. Additionally, the company announced a quarterly cash dividend of 95 cents per share, maintaining its historical trend of dividend growth. This marks the 62nd consecutive year of regular cash dividend increases for Lancaster Colony. These developments reflect the company’s ongoing strategy to deliver value to its shareholders amidst a challenging market environment.

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