Can Lamb Weston's Strategic Moves & Innovations Drive Growth in 2025?

Lamb Weston Holdings, Inc. (LW), a specialist in frozen potatoes, holds a leading position in the global frozen foods industry. The company has built a powerhouse around frozen potato products, fries and appetizers, serving foodservice giants and quick-service restaurants (QSRs), primarily across North America and selected global markets.

LW is benefiting from customer wins and strong retention rates. Lamb Weston’s “Focus to Win” strategic plan, centered on delivering targeted cost savings and working capital improvements to boost profitability, centered on targeted cost savings and working capital improvements to enhance profitability, is making a strong impression. The plan emphasizes a sharper focus on core markets and deepening customer relationships, positioning the company for success amid a competitive landscape.

Lamb Weston has a strong commitment to ongoing product innovations. The company is winning new business by focusing on innovation and adapting to evolving customer needs. LW has introduced innovative products like fridge-friendly fries and premium potato bites to align with shifting consumer preferences. It is focused on investments in priority global markets and segments, reinforcing the customer partnerships and accomplishing executional excellence.

The evolving market dynamics like growth in food delivery, enhanced QSR concepts and the growing popularity of air fryers are creating opportunities with innovation. Management expects customers to continue prioritizing french fries on menus as well as at home, and its outlook demonstrates global restaurant traffic will hold steady with the fiscal 2025 levels. Hence, Lamb Weston’s focus on market share growth, customer retention and operational excellence positions it for sustained business expansion and profitability ahead.

LW’s Price Performance, Valuation and Estimates

Lamb Weston’s shares have lost 18.6% year to date compared with the industry’s 5.4% dip.

From a valuation standpoint, LW trades at a forward price-to-earnings ratio of 17.62X compared with the industry’s average of 15.87X.

The Zacks Consensus Estimate for LW’s fiscal 2026 earnings per share (EPS) indicates a year-over-year decline of 10.5% while that of fiscal 2027 shows growth of 16.4%. The company’s EPS estimate for fiscal 2026 and fiscal 2027 has moved south in the past 30 days.

Lamb Weston currently carries a Zacks Rank #3 (Hold).

Stocks to Consider in the Consumer Staples Space

Nomad Foods (NOMD), which manufactures frozen foods, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

NOMD delivered a trailing four-quarter earnings surprise of 3.2%, on average. The Zacks Consensus Estimate for Nomad Foods’ current financial-year EPS indicates growth of 10.4% from the year-ago number.

Mondelez International (MDLZ), which is a leader in the snack food industry, currently carries a Zacks Rank #2 (Buy).

MDLZ delivered a trailing four-quarter earnings surprise of 9%, on average. The Zacks Consensus Estimate for MDLZ’s current financial-year sales indicates growth of 5.4% from the year-ago number.

Ingredion Incorporated (INGR), which is a provider of ingredient solutions specialized in nature-based sweeteners, starches and nutrition ingredients, currently carries a Zacks Rank of 2.

The Zacks Consensus Estimate for INGR’s current financial-year EPS is expected to rise 6.8% from the corresponding year-ago reported figure. INGR delivered a trailing four-quarter earnings surprise of 11.1%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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