Lifeway Foods (NASDAQ:LWAY) Issues Earnings Results

Lifeway Foods (NASDAQ:LWAY) released its quarterly earnings results on Thursday. The company reported $0.01 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.26 by ($0.25), FiscalAI reports. Lifeway Foods had a return on equity of 17.76% and a net margin of 6.54%.The firm had revenue of $66.89 million for the quarter, compared to analyst estimates of $61.40 million.

Here are the key takeaways from Lifeway Foods’ conference call:

• Record sales continued: Second-quarter net sales rose 24.1% year over year to $66.9 million, marking the 27th consecutive quarter of growth. First-half sales increased 29.9% to $129.9 million, led by Lifeway Kefir and Farmer Cheese.
• Profitability was pressured by inflation: Gross margin fell to 19.5% amid elevated milk prices, higher resin costs, and oil-related transportation expenses. Second-quarter net income was only $0.1 million, or $0.01 per share, and management expects dairy costs to remain a headwind in the third quarter.
• Distribution is expanding: Muscle Mates, Farmer Cheese, Kefir Butter, and other products secured additional placements at Walmart, Kroger, Target, Wegmans, Meijer, and regional retailers, while new food-service channels are broadening consumer trial opportunities.
• Capacity investments support future growth: The Waukesha facility expansion remains on track for completion in early 2027, which management expects will increase production capacity, improve efficiency, and provide flexibility to serve rising retail and food-service demand.

Lifeway Foods Trading Down 15.5%

Lifeway Foods stock traded down $4.52 during midday trading on Thursday, reaching $24.70. The stock had a trading volume of 791,083 shares, compared to its average volume of 113,478. The stock’s 50-day simple moving average is $28.93 and its 200 day simple moving average is $25.01. Lifeway Foods has a twelve month low of $17.31 and a twelve month high of $34.20. The company has a debt-to-equity ratio of 0.08, a quick ratio of 1.56 and a current ratio of 2.14. The stock has a market capitalization of $377.47 million, a PE ratio of 25.46 and a beta of 0.44.

Insider Activity

In related news, major shareholder Ludmila Smolyansky sold 100,000 shares of the firm’s stock in a transaction that occurred on Wednesday, July 22nd. The shares were sold at an average price of $30.11, for a total value of $3,011,000.00. Following the transaction, the insider owned 507,207 shares in the company, valued at approximately $15,272,002.77. This trade represents a 16.47% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, major shareholder Edward Smolyansky sold 39,098 shares of Lifeway Foods stock in a transaction that occurred on Tuesday, July 7th. The shares were sold at an average price of $29.41, for a total transaction of $1,149,872.18. Following the transaction, the insider directly owned 1,071,709 shares in the company, valued at approximately $31,518,961.69. This trade represents a 3.52% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 526,698 shares of company stock valued at $15,245,397 over the last 90 days. 18.58% of the stock is currently owned by insiders.

Institutional Trading of Lifeway Foods

A number of institutional investors have recently added to or reduced their stakes in LWAY. Susquehanna Portfolio Strategies LLC purchased a new position in Lifeway Foods in the fourth quarter valued at about $258,000. Tudor Investment Corp ET AL raised its holdings in shares of Lifeway Foods by 73.0% during the 4th quarter. Tudor Investment Corp ET AL now owns 163,361 shares of the company’s stock valued at $3,958,000 after buying an additional 68,956 shares during the period. Millennium Management LLC raised its holdings in shares of Lifeway Foods by 266.3% during the 4th quarter. Millennium Management LLC now owns 57,545 shares of the company’s stock valued at $1,394,000 after buying an additional 41,836 shares during the period. Man Group plc acquired a new position in Lifeway Foods during the 4th quarter worth approximately $206,000. Finally, Inspire Investing LLC lifted its position in Lifeway Foods by 18.5% during the 4th quarter. Inspire Investing LLC now owns 19,585 shares of the company’s stock worth $475,000 after acquiring an additional 3,062 shares in the last quarter. 36.39% of the stock is owned by hedge funds and other institutional investors.

Wall Street Analysts Forecast Growth

A number of research analysts have weighed in on LWAY shares. Benchmark reissued a “buy” rating on shares of Lifeway Foods in a research note on Monday, June 15th. Weiss Ratings raised Lifeway Foods from a “hold (c+)” rating to a “buy (b-)” rating in a research note on Tuesday, July 28th. Two investment analysts have rated the stock with a Buy rating, According to MarketBeat, the stock presently has a consensus rating of “Buy” and an average price target of $35.00.

About Lifeway Foods

Lifeway Foods, Inc (NASDAQ: LWAY) is a Chicago-based food company specializing in probiotic-rich cultured dairy products. Established in 1986 by Michael Smolyansky, the company pioneered the introduction of kefir to the U.S. market. Under the leadership of CEO Julie Smolyansky, who succeeded her father in 2002, Lifeway has grown from a single product operation into a diversified portfolio of fermented foods and beverages aimed at promoting digestive health and wellness.

The company’s flagship product is kefir, a cultured milk beverage naturally rich in probiotics, vitamins and minerals.