Lamb Weston Holdings, Inc. (LW) AI Stock Analysis

Lamb Weston Holdings, Inc. specializes in the production, distribution, and global marketing of value-added frozen potato products. The company operates across four distinct segments: Global, Foodservice, Retail, and Other. It offers frozen potatoes, commercial ingredients, and appetizers under its flagship Lamb Weston brand, customer labels, and brands such as Grown in Idaho and Alexia. Beyond frozen potatoes, the company is also involved in the vegetable and dairy sectors. It serves grocery stores, mass merchants, club stores, specialty retailers, restaurants, educational institutions, and convenience stores worldwide through an extensive distribution network.

Between FY2022 and FY2026, Lamb Weston expanded annual revenue from $4.10B to $6.61B, reflecting a 5-year CAGR of 12.5%. However, profitability contracted over the same span. Gross margin fell from a high of 27.3% in FY2024 to 20.6% in FY2026, while operating margin declined from 16.5% to 8.9%. Net income decreased from $725.5M in FY2024 to $357.2M in FY2025 and $290.0M in FY2026. In the latest quarter ended August 31, 2026, quarterly revenue growth was 0.7% year-over-year, while quarterly earnings declined 54.3%. TTM revenue stood at $6.62B with an operating margin of 9.5% and a net profit margin of 3.9%.

As of August 31, 2026, Lamb Weston held $166.3M in cash and short-term investments compared to $3.93B in total debt, resulting in net debt of $3.76B. Shareholders' equity was $1.81B, and total assets stood at $7.32B. The company maintained a current ratio of 1.45 and a debt-to-equity ratio of 2.17. Operating cash flow reached $942.9M in FY2026, generating free cash flow of $540.2M after capital expenditures of $402.7M. Capital allocation in FY2026 included $207.5M paid in dividends and $122.8M used for share buybacks.

Lamb Weston trades at a trailing P/E of 29.3x and a forward P/E of 14.7x, compared to medians of 18.6x and 14.3x for its US-listed Consumer Defensive peers. Its enterprise value to EBITDA ratio is 10.2x, below the peer median of 11.7x, while its price-to-sales ratio of 1.1x is above the peer median of 0.7x. Over the past year, Lamb Weston delivered a return of -15.0%, trailing the S&P 500 return of 16.8%. Over five years, the stock gained 5.0% compared to an 83.0% return for the S&P 500.

Lamb Weston pays a quarterly dividend with an annualized forward payout of $1.52 per share, representing a dividend yield of 2.84%. The company has paid dividends for 10 consecutive years and delivered a 5-year annualized dividend growth rate of 10.0%. Its payout ratio stands at 50.2%, and the last ex-dividend date was November 6, 2026.

Wall Street coverage includes 2 Strong Buy, 2 Buy, and 8 Hold ratings, with no Sell or Strong Sell ratings. The mean price target is $56.00, representing 4.5% upside from the last close of $53.59. For the fiscal year ending May 31, 2027, consensus estimates project EPS of $3.22 on revenue of $6.61B. For the following fiscal year, 11 analysts estimate EPS of $3.53 on revenue of $6.75B. The company beat EPS estimates in all of the last 4 quarters.

This page is an AI-written research summary of Lamb Weston Holdings, Inc. (LW). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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