Lamb Weston (NYSE:LW) Shares Gap Down Following Weak Earnings

Shares of Lamb Weston Holdings, Inc. (NYSE:LW) gapped down prior to trading on Thursday following a dissappointing earnings announcement. The stock had previously closed at $78.22, but opened at $65.96. Lamb Weston shares last traded at $65.34, with a volume of 1,796,800 shares traded.

The specialty retailer reported $0.66 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $1.01 by ($0.35). The firm had revenue of $1.60 billion during the quarter, compared to the consensus estimate of $1.67 billion. Lamb Weston had a return on equity of 34.33% and a net margin of 9.57%. Lamb Weston’s revenue for the quarter was down 7.5% on a year-over-year basis. During the same quarter in the prior year, the business earned $1.45 earnings per share.

Lamb Weston Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Friday, November 29th. Investors of record on Friday, November 1st were issued a $0.36 dividend. The ex-dividend date was Friday, November 1st. This represents a $1.44 dividend on an annualized basis and a dividend yield of 2.22%. Lamb Weston’s dividend payout ratio is presently 33.80%.

Wall Street Analyst Weigh In

LW has been the subject of several analyst reports. Wells Fargo & Company increased their target price on shares of Lamb Weston from $70.00 to $77.00 and gave the company an “overweight” rating in a report on Thursday, October 3rd. Deutsche Bank Aktiengesellschaft began coverage on Lamb Weston in a research note on Thursday, December 12th. They issued a “hold” rating and a $81.00 target price on the stock. Bank of America increased their price target on Lamb Weston from $68.00 to $80.00 and gave the company a “neutral” rating in a research report on Monday, October 21st. Barclays upped their price target on Lamb Weston from $70.00 to $74.00 and gave the company an “overweight” rating in a research report on Friday, October 4th. Finally, Stifel Nicolaus boosted their price objective on Lamb Weston from $65.00 to $80.00 and gave the company a “hold” rating in a research note on Friday, October 25th. One research analyst has rated the stock with a sell rating, seven have issued a hold rating and six have given a buy rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Hold” and an average price target of $84.25.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in LW. Nicola Wealth Management LTD. purchased a new position in shares of Lamb Weston in the third quarter worth $6,474,000. Susquehanna Fundamental Investments LLC purchased a new position in Lamb Weston in the 2nd quarter worth about $3,279,000. Clarkston Capital Partners LLC raised its position in Lamb Weston by 108.7% in the 3rd quarter. Clarkston Capital Partners LLC now owns 3,107,929 shares of the specialty retailer’s stock worth $201,207,000 after buying an additional 1,618,570 shares during the last quarter. Citigroup Inc. lifted its stake in Lamb Weston by 39.3% during the 3rd quarter. Citigroup Inc. now owns 156,242 shares of the specialty retailer’s stock valued at $10,115,000 after acquiring an additional 44,057 shares during the period. Finally, First Financial Bankshares Inc purchased a new stake in shares of Lamb Weston during the 3rd quarter valued at about $6,506,000. Institutional investors own 89.56% of the company’s stock.

Lamb Weston Price Performance

The stock has a market capitalization of $9.24 billion, a P/E ratio of 15.21, a price-to-earnings-growth ratio of 1.34 and a beta of 0.70. The business’s 50 day moving average price is $77.11 and its 200 day moving average price is $72.83. The company has a debt-to-equity ratio of 1.87, a current ratio of 1.19 and a quick ratio of 0.54.

About Lamb Weston

Lamb Weston Holdings, Inc produces, distributes, and markets frozen potato products worldwide. The company operates through four segments: Global, Foodservice, Retail, and Other. It offers frozen potatoes, commercial ingredients, and appetizers under the Lamb Weston brand, as well as under various customer labels.