Why Lamb Weston Stock Is Plummeting Today
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By Josh Kohn-Lindquist – Dec 19, 2025 at 11:18AM ESTKey PointsSales volume increased for Lamb Weston, but a lower pricing mix offset this gain.Meanwhile, profitability remains weak as the company ramps up production at its new facilities.Ultimately, guidance was disappointing, so Lamb Weston may be deserving of its discounted valuation for the time being.These 10 Stocks Could Mint the Next Wave of Millionaires ›NYSE: LWLamb WestonMarket Cap$8.3BToday's Changeangle-down(-24.74%) $14.68Current Price$44.65Price as of December 19, 2025 at 11:45 AM ETFrozen potato behemoth Lamb Weston saw its stock sell-off again after offering underwhelming earnings.Shares of leading frozen potato supplier Lamb Weston (LW 24.74%) plummeted 22% as of 11 a.m. ET on Friday after the French fry juggernaut provided underwhelming earnings again. Following today's drop, Lamb Weston is down 60% from its all-time high in 2023 and trades at its lowest share price since 2017. ExpandNYSE: LWLamb WestonToday's Change(-24.74%) $-14.68Current Price$44.65Key Data PointsMarket Cap$8.3BDay's Range$44.45 - $50.8752wk Range$44.45 - $68.61Volume456KAvg Vol1.8MGross Margin20.83%Dividend Yield2.49% During the second quarter, the company grew sales by 1% and delivered adjusted earnings per share of $0.69, which beat Wall Street's expectations. However, management offered full-year guidance that spooked the market, saying that revenue would be flat year-over-year, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) would be down 11% at the midpoint. Lamb Weston: sales volume up, pricing down The good news for Lamb Weston in Q2 was that sales volume grew by 8% in North America and 7% in its international markets. However, due to strong potato crops and the continued weakness in the quick-service restaurant industry, the company saw its pricing mix drop 8% in both markets, offsetting its volume gains. Image source: Getty Images. Making matters worse, Lamb Weston's EBITDA and free cash flow (FCF) generation remain in a state of flux as it ramps up production at its new processing plant in Argentina. Though management expects to realize cost savings of $100 million in 2026 and $250 million by 2028, its guidance for declining adjusted EBITDA this year disappointed the market. Lamb Weston has spent heavily on capex recently -- over $1 billion in 2024 versus $400 million over the last year -- so 2026 will be a pivotal year for the company to show that its investments will turn into market share gains. If the company can show it is taking share after this capex spending and revenue returns to growth, Lamb Weston could be a steal, generating $900 million in cash from operations (CFO) compared to its enterprise value of $12.2 billion (13 times CFO).Advertisement That said, I'm not really interested in the company while it's in the midst of a turnaround, but it could be intriguing to value investors.Read NextApr 3, 2025 •By Billy DubersteinWhy Consumer Staples Stocks Lamb Weston, Conagra, and Philip Morris Rallied Today Even as the Market PlungedDec 19, 2024 •By Jeremy BowmanWhy Lamb Weston Stock Was Diving TodayOct 18, 2024 •By Jeremy BowmanWhy Lamb Weston Stock Was Climbing TodayOct 2, 2024 •By Eric VolkmanWhy Lamb Weston Holdings Stock Was a Winner on WednesdayJul 26, 2024 •By Eric VolkmanWhy Lamb Weston Stock Was Plummeting This WeekJul 24, 2024 •By Jon QuastWhy Lamb Weston Stock Tanked TodayAbout the AuthorJosh Kohn-Lindquist is a contributing Motley Fool stock market analyst covering consumer goods, industrials, and technology stocks. Previously, Josh was a senior mutual fund accountant at Gemini Fund Services. He holds a bachelor’s degree in business management from the University of South Dakota.TMFJorykoX@JorykoliStocks MentionedLamb WestonNYSE: LW$44.65 (0.25%) $14.68*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.Advertisement