LW Stock Forecast & Price Target

Lamb Weston Holdings has raised its fiscal year 2024 guidance, now projecting EBITDA between $1.540 billion and $1.620 billion, reflecting significant growth of 23% to 30% largely driven by the LW EMEA acquisition. The company also adjusted its revenue outlook to a range of $6.8 billion to $7.0 billion, indicating a 27% to 31% increase, with an underlying sales growth rate of 6.5% to 8.5%, showcasing resilience in volume and price/mix dynamics. Additionally, the anticipated margin improvements in North America and favorable potato market conditions further bolster the positive outlook for Lamb Weston's financial performance.

Lamb Weston Holdings is facing significant challenges that have led to a negative outlook, including share losses, soft restaurant traffic, and a supply/demand imbalance, which have resulted in a downward revision of FY25 EBITDA expectations to $1.44 billion, a decrease of $228 million from previous estimates. The company anticipates a 34% decline in EBITDA for the first quarter of FY25, alongside a projected 3% volume decline in the first half of the fiscal year, attributed to competitive pressures and the exit from lower-margin European markets. Furthermore, the first quarter is expected to reflect a 6% decline in sales, driven by a combination of reduced volume and price/mix, exacerbated by increased advertising costs aimed at regaining market share.