Why the Market Dipped But Lamb Weston (LW) Gained Today
In the latest trading session, Lamb Weston (LW) closed at $99.68, marking a +0.47% move from the previous day. This move outpaced the S&P 500's daily loss of 0.2%. Meanwhile, the Dow lost 0.16%, and the Nasdaq, a tech-heavy index, lost 0.07%.
Heading into today, shares of the frozen foods supplier had gained 11.62% over the past month, outpacing the Consumer Staples sector's gain of 5.4% and the S&P 500's gain of 7.49% in that time.
Market participants will be closely following the financial results of Lamb Weston in its upcoming release. On that day, Lamb Weston is projected to report earnings of $1.40 per share, which would represent year-over-year growth of 9.38%. Meanwhile, our latest consensus estimate is calling for revenue of $1.69 billion, up 32.61% from the prior-year quarter.
For the full year, the Zacks Consensus Estimates project earnings of $5.84 per share and a revenue of $6.86 billion, demonstrating changes of +24.79% and +28.29%, respectively, from the preceding year.
Investors should also note any recent changes to analyst estimates for Lamb Weston. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. At present, Lamb Weston boasts a Zacks Rank of #1 (Strong Buy).
In terms of valuation, Lamb Weston is presently being traded at a Forward P/E ratio of 16.98. Its industry sports an average Forward P/E of 16.66, so one might conclude that Lamb Weston is trading at a premium comparatively.
We can also see that LW currently has a PEG ratio of 1.27. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Food - Miscellaneous stocks are, on average, holding a PEG ratio of 2.43 based on yesterday's closing prices.
The Food - Miscellaneous industry is part of the Consumer Staples sector. With its current Zacks Industry Rank of 140, this industry ranks in the bottom 45% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Lamb Weston (LW) : Free Stock Analysis Report
