Earnings Alert: Lamb (LW), Tilray (TLRY) post solid quarterly revenue

Food company Lamb Weston Holdings Inc. (NYSE: LW) and cannabis firm Tilray Inc. (NASDAQ: TLRY) declared strong quarterly revenue growth on Thursday. The LW stock traded at US$63.25, up 1.46%, while TLRY traded at US$11.03, up 2.22%, in the premarket at around 8 am ET.

Here we look at the quarterly performance of the two companies.

Lamb Weston Holdings, Inc.

Lamb Weston is one of the largest producers of branded frozen potato products like French fries, chips, diced potato, sweet potato fries, etc.

The Eagle, Idaho-based company earns around 80 percent of its revenue from the US, and the rest comes from other geographies like Canada, Japan, Korea, and countries in Europe.

It became an independent company in 2016 after breaking away from ConAgra.

Lamb Weston posted net sales of US$984.2 million, up 13 percent, in the first quarter ended August 29, 2021, compared to US$871.5 million in the corresponding period of 2020.

The sales contribution from the global segment was 51 percent, food service 33 percent, retail 13 percent, and others contributed 3 percent. Its income from operation declined by 56 percent YoY to US$60 million against US$135.7 million in the year-ago period.

Lamb Weston’s net income was US$29.8 million, a decline of 67 percent, compared to US$89.3 million in the same period a year ago. Its earnings per share diluted also decreased by 67 percent to US$0.20 from US$0.61 in the August quarter of 2020.

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The company expects net sales growth to remain above the low-single-digit range for FY 2022.

Its market capitalization is US$9 billion, with a P/E ratio of 28.86 and forward P/E for one year of 25.76. The dividend yield of the company is 1.51 percent, and annualized dividend is US$0.94. The next ex-dividend date is November 4, 2021, for a dividend of US$0.235.

The stock closed at US$62.34, with a share volume of 2,301,783 on Oct 6, 2021.

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Tilray, Inc.

Tilray produces medical and recreational cannabis. It is headquartered in New York, but Canada is its primary market. It is the top cannabis brand in Canada with the biggest market share.

Its revenue increased by 43 percent to US$168 million in the first quarter ended August 31 of FY 2022 compared to US$117 million in Q1 of the previous year. Of its four revenue segments, the cannabis segment contributed 42 percent of the total revenue. The distribution segment contributed 40 percent, Beverage alcohol 9 percent and the wellness segment 9 percent.

The gross profit increased by 46 percent to US$51 million compared to US$35 million for the same period a year ago.

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It booked a net loss of US$34.6 million against a net loss of US$21.7 million in the comparable quarter of 2020. The loss per share diluted reduced to US$0.08 from US$0.09 in the August quarter of 2020.

In Q1, Tilray launched medical cannabis edibles in Canada. It completed the amended convertible notes acquisition in MedMen for a better footing in the US. Medmen is a cannabis retailer in the US pot market, which is currently worth around US$80 billion.

Tilray has a market capitalization of US$4.8 billion. The stock closed at US$10.79 with a share volume of 18,595,380 on Oct 6.

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Bottomline

The NYSE Composite gave a 14.10 percent return YTD, while NASDAQ Composite rose 14.32 percent YTD, indicating modest gains. On the other hand, LW fell nearly 17 percent, and TLRY rose around 20 percent YTD, underscoring the ups and downs in the market. However, investors should analyze the company fundamentals thoroughly before investing in stocks.