We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Lifeway Foods, Inc. (LWAY)
An SI Board Since October 2004
Posts SubjectMarks Bans Symbol
338 7 0 LWAY
Emcee:  Glenn Petersen Type:  Unmoderated
The principal business activity of Lifeway Foods, Inc. (LWAY) is the manufacturing of probiotic, cultured, functional dairy and non-dairy health food products. Lifeway's primary product is kefir, a fermented drinkable dairy beverage similar to but distinct from yogurt. Kefir has a slightly effervescent quality, with a taste similar to yogurt and a consistency similar to buttermilk. It is a product distinct from yogurt because it incorporates the unique microorganisms of kefir as the cultures to ferment the milk.

Lifeway Foods was founded in February 1986. It completed its initial public offering on March 29, 1988. Since 1994, the company has grown its revenues at a compounded annual rate of 17%, from $3,541,841 in 1994 to $14,877,788 in 2003. During that same period the company’s operating earnings have grown at a compounded annual rate in excess of 27%, from $386,089 to $3,478,644.

The company has 8,438,888 shares outstanding, of which 70.0% are closely held. There are no outstanding options. The Smolyansky family, the founders, own 49.5% of the outstanding shares. Danone Foods, Inc. owns 20.5%. There are approximately 2,540,000 shares in the float. (Note: These figures were taken from the company’s proxy materials that were filed earlier in the year and have not been adjusted to reflect recent insider sales.) As of October 2004, Nasdaq reported the short interest position at 670,900 shares, approximately 26.4% of the float.

The company was “discovered” by Motley Fool’s Rick Smith in an article posted on February 9, 2004. Prior to the posting of the article, the stock was trading at $7.08 per share and the volume averaged less than 5,000 shares per day. Following publication of Smith’s article, the stock price exploded, tripling to a high of $28.24 on April 13, 2004. The company subsequently hit some earnings bumps – the price of milk, the main ingredient for keifr, doubled – and the stock has retraced most of its gains. It closed Friday at $4.55 per share, adjusted for a 2006 two-for-one split.

In October 1999, the company entered into a Shareholder’s Agreement with Danone Foods, Inc. According to the terms of that agreement, Danone agreed not to purchase any additional shares in LWAY and the two companies agreed not to compete in certain product lines for a five year period. The agreement expired at the end of September, though the two companies have extended it for an additional month while they attempt to negotiate a new agreement.

I have several reasons for liking this company. It occupies an attractive niche and management has achieved an enviable record of consistent and profitable growth. It would make a perfect acquisition for Danone Foods. The company is selling at approximately 30 times earnings. While not exactly cheap, the PE ratio is not out of line with the company’s historical record. The price of milk has come down and the company should be able to resume its earnings growth. The low float and the high short interest position is a short term positive

It is a family run business, always a negative. There have been some insider sales this year, primarily after the initial publication of the Rick Smith article.

The above comments are only my opinions. Anyone interested in the company should do their own due diligence.

Company website:

SEC filings:

Previous 25 | Next 25 | View Recent | Post Message
Go to reply# or date (mm/dd/yy):
ReplyMessage PreviewFromRecsPosted
338Third quarter earnings: Lifeway Foods® Announces Record Results for thGlenn Petersen-11/21/2023
337Chobani withdraws IPO plans after yogurt maker filed in November to go public PGlenn Petersen19/2/2022
336Chobani Executives Depart as Yogurt Maker Delays IPO Leadership shake-up comes Glenn Petersen13/11/2022
335The company piggy bank rolls on.richardred13/2/2022
334Lifeway’s Independent Directors Support CEO Julie Smolyansky and Lifeway 2.0 StrGlenn Petersen13/2/2022
333A mother-daughter-brother feud. A Family Feud Just Placed Lifeway Foods Stock FGlenn Petersen12/28/2022
332 BRIEF-Ludmila Smolyansky Says Notified Lifeway Foods's Board That Co Shorichardred12/28/2022
331LWAY as a COVID-19 play: Lifeway Foods, Inc. Increases Production to Support AGlenn Petersen-5/6/2020
330USMCA-Dairy products- upon signing -maybe a positive for LWAY? There still seemsrichardred-1/29/2020
329Lifeway Foods Now Selling Plantiful-Based Soft-Serve Treats. New popular vegan richardred-8/13/2019
328The next step I guess. Cannabis Drinks Expo in San Francisco, July 25, 2019 wilrichardred-6/22/2019
327Lifeway Foods reveals plan to enter CBD category ByAndy Coyne | 21 June 201richardred26/22/2019
326It's happening. Who cares about profitability, it's CBD :+ ) Messagerichardred16/20/2019
325A dismal fourth quarter; a dismal year: globenewswire.comGlenn Petersen14/15/2019
324Lifeway Foods' Plantiful wins award Posted3/16/20richardred-3/31/2019
323Cannabis-infused kefir could be a big seller. :) They broke the piggy bank. TheGlenn Petersen-1/6/2019
322>"It's not about money, it's about healing people," she sayrichardred-12/28/2018
321Lifeway seems stalled. Worse than stalled. What's going on at Lifeway FoodGlenn Petersen-12/28/2018
320I've been looking a lot at LWAY lately FWIW because of the low price. . Lifrichardred-1/20/2018
319Second quarter results: Petersen-8/29/2017
318LWAY's fourth quarter press release: Form 10-K: sec.govGlenn Petersen-4/17/2017
317The second quarter press release: Petersen-8/22/2016
316I guess multiple births (triplets quints etc.) here in the US are not enough to Ahda-5/24/2016
315Friday Afternoon Links Mark J. Perry American Enterprise Institute May 20, 2016Glenn Petersen-5/23/2016
314Fourth quarter and year end results (press release): Form 10-Glenn Petersen-3/18/2016
Previous 25 | Next 25 | View Recent | Post Message
Go to reply# or date (mm/dd/yy):