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Investing.com - Stifel raised its price target on Lamb Weston (NYSE:LW) to $61.00 from $56.00 on Thursday, while maintaining a Hold rating on the stock following the company’s fourth-quarter earnings report. The stock has shown remarkable momentum, gaining nearly 20% in the past week. According to InvestingPro analysis, the company appears slightly undervalued at current levels.
The food processing company reported adjusted EBITDA of $285 million for the quarter, exceeding Stifel’s estimate by $33 million. North America volume growth reached 4%, surpassing expectations of a modest decline. The company’s trailing twelve-month EBITDA stands at $1.17 billion, with a healthy gross profit margin of 22.85%.
Lamb Weston’s initial fiscal year 2026 guidance came in below consensus estimates, but Stifel noted that the expected price/mix trajectory is encouraging. The company also announced a new cost savings program targeting $250 million in savings through fiscal year 2028.
The company has completed its business assessment and outlined next steps including a strategic review for non-core assets, executing cost savings initiatives, and investing to support improved commercial capabilities.
Stifel lowered its fiscal year 2026 estimates for Lamb Weston but viewed the volume momentum and price/mix trajectory in North America favorably, supporting the decision to raise the price target while maintaining the Hold rating.
In other recent news, Lamb Weston Holdings Inc . reported impressive results for its fiscal fourth quarter of 2025, surpassing both earnings and revenue forecasts. The company achieved an earnings per share (EPS) of $0.87, significantly higher than the anticipated $0.64, and generated revenue of $1.68 billion, exceeding the forecasted $1.59 billion. These results have been described as a "solid volume-led beat" by Jefferies, which subsequently raised its price target for Lamb Weston to $67, maintaining a Buy rating. Similarly, Bernstein increased its price target to $62, citing strong volumes and effective cost containment measures as reasons for the upgrade. Both analyst firms highlighted Lamb Weston’s strategic moves, including price investments in North America, to bolster its market position. The company’s fiscal year 2026 guidance also indicates sales slightly ahead of expectations. These developments underscore Lamb Weston’s effective operational strategies and positive market reception.
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