# Lifeway Foods (LWAY.US)

Canonical: https://gigainvestors.com/s/LWAY

Analysis as of: 2026-10-16T07:29:59.743Z. Financial observations: FY1996–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $22.21 per share; close as of 2026-10-15.

Estimated value: low $7.50 per share, central $10.03 per share, high $11.72 per share. Buy at or below the central value $10.03 per share. Valuation as of 2026-10-16T07:29:59.743Z; scenarios are not confidence intervals.

Expected annual return: 6.2% at the stated quote. About 6.2% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 2

- Operating margin variation: 1.14×

Chart: Operating margin; fiscal year observations.

- FY2017: -0.00×

- FY2018: -0.03×

- FY2019: -0.02×

- FY2020: 0.05×

- FY2021: 0.05×

- FY2022: 0.02×

- FY2023: 0.11×

- FY2024: 0.07×

- FY2025: 0.08×

- LTM to Jun 2026: 0.06×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 11.0%

- ROIC, second-lowest year: -3.7%

- Typical minus recent gross margin: -0.1 pp

- Typical gross margin (annual median): 25.9%

- Recent gross margin (lower of latest and 3-year median): 26.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 2.7%

- ROIC including acquisitions, ten-year median: 6.5%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: -1.1%

- FY2018: -6.8%

- FY2019: -3.7%

- FY2020: 11.3%

- FY2021: 10.7%

- FY2022: 4.0%

- FY2023: 30.2%

- FY2024: 20.7%

- FY2025: 16.5%

- LTM to Jun 2026: 12.5%

### economics: fail

- owner earnings cash conversion below threshold

- Owner earnings / net income, 5-yr: 0.53×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $20M

- Net income, five-year total: $38M

- Return on incremental invested capital: 25.1%

- Working capital / revenue, annual change: -0.2 pp

- Working capital / revenue, change between three-year averages: -1.9 pp

- Working capital / revenue, final three-year average: 8.0%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.29×

- FY2022: 1.00×

- FY2023: 1.00×

- FY2024: 1.00×

- FY2025: -0.38×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: -1.1% vs 20.7%

- Per-share earnings: 0.12 to 0.75 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.5%

- Ordinary dilution, 5-year annual growth: -0.3%

- Market cap gain: $183M

- Cumulative retained earnings: $39M

- Diluted shares, 10-year annual growth: -0.5%

- Diluted shares, 5-year annual growth: -0.3%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 25.7%

- Per-share value change: $0.63

- Per-share value, starting three-year median: $0.12

- Per-share value, ending three-year median: $0.75

- Buybacks concentrated in cheaper years (correlation): -0.39

- Average buyback yield: 2.2%

- Buyback history: 7 years

- Debt-funded buybacks: No

- Acquisition spending: $5.8M

- Cumulative net income, 10 years: $42M

- ROIC, first three-year median: -1.1%

- ROIC, last three-year median: 20.7%

Chart: Earnings per share; fiscal year observations.

- FY2016: $0.22

- FY2017: -$0.02

- FY2018: -$0.19

- FY2019: $0.03

- FY2020: $0.20

- FY2021: $0.21

- FY2022: $0.06

- FY2023: $0.75

- FY2024: $0.60

- FY2025: $0.89

### accounting: pass

- stock compensation exceeds 15% of operating cash flow

- Sloan accruals: 2.8%

- Receivables to sales index (DSRI): 0.91×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 17.8%

- Earnings backed by cash: Yes

- Operating cash / earnings: 0.79×

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.20×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -2.5%

- FY2017: -6.4%

- FY2018: -9.7%

- FY2019: -5.7%

- FY2020: -5.1%

- FY2021: -3.2%

- FY2022: -4.4%

- FY2023: -6.7%

- FY2024: -4.3%

- FY2025: 2.8%

## Holders

## Price story

Down 27% since Aug 2025 · "Lifeway Foods Inc (LWAY) (Q2 2026) Earnings Call Highlights: Record Sales Amidst Cost Pressures" (finance.yahoo.com, Aug 2026) · sales +14.1%

Story as of 2026-10-16T09:59:06.749Z; price observation 2026-10-15.

Price needs cash profits to grow 15.2% a year for ten years

- 2025-09-18: Lifeway Foods slides after Danone pulls takeover offer ([seekingalpha.com](https://seekingalpha.com/news/4496057-lifeway-foods-slides-after-danone-pulls-takeover-offer?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

### Sales · FY2025–2026

sales +14.1%; source https://www.sec.gov/Archives/edgar/data/814586/000168316826001886/lifeway_i10k-123125.htm; observed 2026-03-17.

- FY2017: $119M 

- FY2018: $103M 

- FY2019: $94M 

- FY2020: $102M 

- FY2021: $119M 

- FY2022: $142M 

- FY2023: $160M 

- FY2024: $187M 

- FY2025: $212M 

- FY2026: $242M 

### Gross margin · FY2026

gross margin 26%; source https://www.sec.gov/Archives/edgar/data/814586/000168316826001886/lifeway_i10k-123125.htm; observed 2026-03-17.

- FY2017: 25.8% 

- FY2018: 25.0% 

- FY2019: 23.6% 

- FY2020: 26.4% 

- FY2021: 24.1% 

- FY2022: 18.9% 

- FY2023: 26.5% 

- FY2024: 26.0% 

- FY2025: 27.4% 

- FY2026: 26.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in packaged foods; annual sales are USD 212.5 million.

- Source: https://www.sec.gov/Archives/edgar/data/814586/000168316826001886/lifeway_i10k-123125.htm (filed 2026-03-17); FY2025: revenue 212496000; grossProfit 58206000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-05); LWAY.US: Lifeway Foods, Inc. produces and markets probiotic-based products in North America. The company's primary product is drinkable kefir, a cultured dairy product in various organic and non-organic sizes, flavors, and milk types. It offers European-style soft cheeses, including farmer and white cheeses, and sweet kiss; cream and other products; drinkable yogurt; ProBugs, a line of kefir products designed for children; and Fresh Made butter and sour cream. The company sells its products under the Lifeway, Fresh Made, and GlenOaks Farms brand names, as well as under private labels on behalf of customers primarily through direct sales force, brokers, and distributors. Lifeway Foods, Inc. was incorporated in 1986 and is based in Morton Grove, Illinois.

### Why customers stay

Margins ranged from 26% to 27.4% during 2023–25; it earns 11% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2023: grossProfit / revenue = 26.5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2024: grossProfit / revenue = 26%.

- Source: https://www.sec.gov/Archives/edgar/data/814586/000168316826001886/lifeway_i10k-123125.htm (filed 2026-03-17); FY2025: grossProfit / revenue = 27.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); 10-year return on capital observations [[2017,-0.011074274445007063],[2018,-0.0677242405865814],[2019,-0.03716318140140199],[2020,0.1132818538360321],[2021,0.10718792943881987],[2022,0.0400748031496063],[2023,0.3017038748558847],[2024,0.2065281218460409],[2025,0.1649780322251936],[2026,0.12498481614249514]]; median 0.11023489163742599. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid no dividends in 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2016: growth capex 217000; upkeep 3020000; owner earnings 3479000. Growth capex / owner earnings = 0.06237424547283702.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2019: growth capex 0; upkeep 1178000; owner earnings 2613000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2020: growth capex 0; upkeep 1895000; cash acquisitions 0; owner earnings 4576000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2021: growth capex 0; upkeep 1922000; cash acquisitions 5220000; owner earnings 4262000. Growth capex plus acquisitions / owner earnings = 1.2247770999530736.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2022: growth capex 477000; upkeep 2972000; cash acquisitions 580000; owner earnings 924000. Growth capex plus acquisitions / owner earnings = 1.143939393939394.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2023: growth capex 1189000; upkeep 3162000; cash acquisitions 0; owner earnings 11367000. Growth capex plus acquisitions / owner earnings = 0.10460103809272456.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); FY2024: growth capex 3311000; upkeep 3386000; owner earnings 9025000. Growth capex / owner earnings = 0.36686980609418285.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); Dividend observations: [[2016,0],[2017,0],[2018,0],[2019,0],[2020,0],[2021,0],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 39.3% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-05); LWAY.US SharesStats.PercentInsiders = 39.25 percentage points; cache date 2026-10-05.

### What the price says

The price assumes cash profits grow 15.2% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-03-17); Ten-year compound average after fade. Initial solved rate 0.20649423297187564. Price 22.21; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.19019043536831792 → FY2025 -0.33618849835467535. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $17.88 per share

- 2016-11: $11.63 per share

- 2016-12: $11.51 per share

- 2017-01: $10.77 per share

- 2017-02: $10.51 per share

- 2017-03: $10.73 per share

- 2017-04: $9.60 per share

- 2017-05: $9.82 per share

- 2017-06: $9.34 per share

- 2017-07: $9.17 per share

- 2017-08: $8.70 per share

- 2017-09: $8.90 per share

- 2017-10: $10.06 per share

- 2017-11: $10.18 per share

- 2017-12: $8.00 per share

- 2018-01: $7.94 per share

- 2018-02: $6.76 per share

- 2018-03: $5.99 per share

- 2018-04: $5.31 per share

- 2018-05: $5.10 per share

- 2018-06: $5.03 per share

- 2018-07: $3.72 per share

- 2018-08: $3.60 per share

- 2018-09: $2.66 per share

- 2018-10: $2.90 per share

- 2018-11: $2.65 per share

- 2018-12: $1.88 per share

- 2019-01: $2.75 per share

- 2019-02: $2.35 per share

- 2019-03: $2.42 per share

- 2019-04: $2.11 per share

- 2019-05: $2.13 per share

- 2019-06: $3.64 per share

- 2019-07: $3.41 per share

- 2019-08: $2.92 per share

- 2019-09: $2.19 per share

- 2019-10: $2.01 per share

- 2019-11: $2.04 per share

- 2019-12: $1.99 per share

- 2020-01: $2.25 per share

- 2020-02: $2.05 per share

- 2020-03: $1.92 per share

- 2020-04: $2.66 per share

- 2020-05: $2.37 per share

- 2020-06: $2.28 per share

- 2020-07: $2.89 per share

- 2020-08: $4.63 per share

- 2020-09: $5.03 per share

- 2020-10: $4.61 per share

- 2020-11: $7.01 per share

- 2020-12: $5.41 per share

- 2021-01: $6.02 per share

- 2021-02: $5.70 per share

- 2021-03: $5.40 per share

- 2021-04: $4.98 per share

- 2021-05: $5.71 per share

- 2021-06: $5.18 per share

- 2021-07: $6.35 per share

- 2021-08: $5.50 per share

- 2021-09: $5.60 per share

- 2021-10: $5.44 per share

- 2021-11: $5.17 per share

- 2021-12: $4.60 per share

- 2022-01: $5.13 per share

- 2022-02: $6.29 per share

- 2022-03: $7.22 per share

- 2022-04: $5.72 per share

- 2022-05: $5.52 per share

- 2022-06: $4.97 per share

- 2022-07: $5.32 per share

- 2022-08: $6.25 per share

- 2022-09: $5.72 per share

- 2022-10: $5.85 per share

- 2022-11: $6.68 per share

- 2022-12: $5.55 per share

- 2023-01: $5.34 per share

- 2023-02: $6.02 per share

- 2023-03: $6.04 per share

- 2023-04: $6.01 per share

- 2023-05: $6.00 per share

- 2023-06: $6.55 per share

- 2023-07: $6.52 per share

- 2023-08: $10.75 per share

- 2023-09: $10.34 per share

- 2023-10: $10.67 per share

- 2023-11: $14.06 per share

- 2023-12: $13.41 per share

- 2024-01: $12.45 per share

- 2024-02: $12.09 per share

- 2024-03: $17.22 per share

- 2024-04: $20.45 per share

- 2024-05: $15.36 per share

- 2024-06: $12.77 per share

- 2024-07: $12.33 per share

- 2024-08: $19.18 per share

- 2024-09: $25.92 per share

- 2024-10: $26.61 per share

- 2024-11: $24.45 per share

- 2024-12: $24.80 per share

- 2025-01: $23.04 per share

- 2025-02: $21.15 per share

- 2025-03: $24.45 per share

- 2025-04: $23.68 per share

- 2025-05: $22.60 per share

- 2025-06: $24.65 per share

- 2025-07: $25.22 per share

- 2025-08: $30.47 per share

- 2025-09: $27.76 per share

- 2025-10: $23.99 per share

- 2025-11: $24.79 per share

- 2025-12: $24.23 per share

- 2026-01: $22.03 per share

- 2026-02: $22.16 per share

- 2026-03: $19.34 per share

- 2026-04: $26.84 per share

- 2026-05: $23.83 per share

- 2026-06: $29.84 per share

- 2026-07: $29.78 per share

- 2026-08: $26.03 per share

- 2026-09: $21.19 per share

- 2026-10: $22.21 per share

## Annual estimated value (USD per share)

- FY2016: low $2.71 per share, central $3.19 per share, high $3.65 per share

- FY2017: low $0.99 per share, central $1.31 per share, high $1.51 per share

- FY2019: low $1.82 per share, central $2.05 per share, high $2.37 per share

- FY2020: low $2.35 per share, central $2.62 per share, high $2.98 per share

- FY2021: low $2.84 per share, central $3.31 per share, high $3.78 per share

- FY2022: low $2.85 per share, central $3.23 per share, high $3.73 per share

- FY2023: low $5.33 per share, central $6.67 per share, high $7.69 per share

- FY2024: low $7.98 per share, central $10.45 per share, high $12.10 per share

- FY2025: low $6.35 per share, central $8.50 per share, high $9.94 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/814586/000168316826001886/lifeway_i10k-123125.htm); period 2025-12-31, filed 2026-03-17.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.