Food processing company Lamb Weston Holdings, Inc. (NYSE:LW) revealed that its board of directors has approved a hike to the quarterly dividend and increased the existing share repurchase authorization.
The company’s board declared a quarterly common stock dividend of $0.245 per share, up 4 cents from the prior payout. The dividend will be paid on March 4, 2022, to shareholders of record as of February 4, 2022.
The company’s annual dividend of $0.98 per share now reflects a dividend yield of 1.7%, based on Friday’s closing price.
Additional Share Buyback Authority
Lamb Weston raised its existing share buyback plan by up to an additional $250 million of its common stock. The program comes with no expiration date.
Under the program, shares can be repurchased in the open market, through privately negotiated transactions, or via a combination of the foregoing. The timing and amount of stock repurchases will be subject to the company’s evaluation of market conditions.
Last week, Goldman Sachs analyst Adam Samuelson maintained a Hold rating on the stock and lowered the price target to $69 from $71. This implies 18.9% upside potential to current price levels.
Overall, the rest of the Street has a bullish outlook on the stock, with a Strong Buy consensus rating based on 4 Buys and 1 Hold. The Lamb Weston price target of $75 implies upside potential of about 29.2% from current levels.
LW scores a 9 out of 10 on TipRanks’ Smart Score rating system, suggesting that the stock is likely to Outperform market averages.
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