Lamb Weston stock price target raised to $60 from $58 at TD Cowen

Investing.com - TD Cowen raised its price target on Lamb Weston (NYSE:LW) to $60 from $58 while maintaining a Hold rating on the stock. The company’s shares, currently trading at $58.08, have shown strong momentum with an 8% gain over the past week. According to InvestingPro data, the stock appears undervalued based on its Fair Value analysis.

The firm noted that Lamb Weston’s first-quarter volume and EBITDA exceeded internal expectations, but management kept its fiscal year 2026 guidance unchanged due to anticipated price/mix headwinds. The company maintains a GOOD overall financial health score, with strong profitability metrics including a 22.6% gross margin and consistent dividend growth for 9 consecutive years.

TD Cowen highlighted that new business wins and the company’s decision to restart a previously curtailed production line demonstrate regained commercial momentum with customers.

Despite these positive developments, the research firm acknowledged that Lamb Weston still faces challenges in fully restoring volume and margins to previous levels.

The new $60 price target reflects a 10.0x EBITDA valuation based on TD Cowen’s fiscal year 2027 EBITDA estimate, with the firm identifying a potential strategic acquisition as the biggest upside risk and increased competitive intensity as the primary downside risk.

In other recent news, Lamb Weston Holdings Inc . reported impressive financial results for the first quarter of fiscal year 2026, surpassing analysts’ expectations. The company achieved an earnings per share of $0.74, which was significantly higher than the forecasted $0.55, marking a 34.55% surprise. Additionally, Lamb Weston’s revenue reached $1.66 billion, exceeding the anticipated $1.62 billion. Following these strong results, analyst firms have adjusted their evaluations of the company. Stifel raised its price target for Lamb Weston to $63.00 from $61.00, citing stronger-than-expected volume growth in North America and improved gross margins. Similarly, Bernstein increased its price target to $65.00 from $62.00, highlighting strong volume growth driven by new customer wins and enhanced sales in quick-service restaurants overseas. Both firms maintained their existing ratings, with Stifel at Hold and Bernstein at Market Perform. These developments reflect positive investor sentiment toward Lamb Weston’s recent performance.

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