We recently published a list of 10 Best Packaged Food Stocks to Buy Now. In this article, we are going to take a look at where Lamb Weston Holdings, Inc. (NYSE:LW) stands against other best packaged food stocks to buy now.

The American Packaged Food Industry

According to a report by Grand View Research, the US packaged food market had a size of $1.03 trillion in 2021. It is expected to grow at a compound annual growth rate (CAGR) of 4.8% between 2022 and 2030. The primary growth drivers for the industry include the rising consumer inclination for convenience coupled with consumers’ hectic lives and work schedules. In addition, the rise in e-commerce sales in the US is another significant factor supporting the sale of packaged food nationwide. Growing innovation in plant-based products, food packaging, healthy ingredients, and bold flavors is expected to continue driving this growth in the United States in the coming years.

READ ALSO: 14 Best Farmland and Agriculture Stocks Buy Now and 10 Best Consumer Staples Stocks to Buy According to Analysts. 

Are Consumer Staples a Safe Haven Amid Market Uncertainty?

On April 8, BofA Securities analysts Bryan D. Spillane, Lisa K. Lewandowski, and Peter T. Galbo released their research findings on the consumer staples industry and their expected performance in case of a potential recession. The analysts iterated that in a majority of recent recessions, consumer staples have historically outperformed the S&P 500 as a sector. This trend points towards a defensive edge for the sector. However, the analysts also cautioned that current market conditions, including weak volume growth and lingering high prices, should be considered, as they may affect the sector’s resilience in a future downturn. Despite these concerns, consumer staples make up an appealing sector for investors and experts due to their limited exposure to the recently imposed tariffs, potentially helping sustain valuation multiples.

During recessions, the stock prices in the consumer staples sector are typically affected by earnings per share (EPS) instead of sales growth. Yahoo! Finance reported that sector analysis highlights forward EPS accounting for more than 90% of stock price movement across central subsectors, including Packaged Food, Beverages, Household and Personal Care, and Tobacco. The analysts also opined that these trends reflect the significance of earnings strength when determining stock performance in volatile and uncertain economic conditions.

Yahoo! Finance further reported that the top-performing stocks in the consumer staples sector are likely to share three common traits. These include solid balance sheets with the potential to sustain share buybacks to boost EPS, profit flexibility to offset increasing costs and revenue pressure, and a strong manufacturing presence in the US to constrain tariff-related inflation.

Our Methodology

We sifted through stock screeners, financial media reports, and ETFs to compile a list of 30 packaged food stocks and chose the top 10 most popular among hedge funds as of Q4 2024. The list is ordered in ascending order of hedge fund sentiment. We sourced the hedge fund sentiment data from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Potatoes being sorted on a conveyor belt in a modern packing facility.

Lamb Weston Holdings, Inc. (NYSE:LW)

Number of Hedge Fund Holders: 47

Lamb Weston Holdings, Inc. (NYSE:LW) is a global distributor, producer, and marketer of packaged frozen potato products. It supplies frozen potatoes, sweet potatoes, vegetable products, and appetizers to retailers and restaurants worldwide. Its operations are divided into North America and International segments.

The company’s fiscal Q3 2025 earnings showed a 9% volume growth, while net sales rose 4%. Its adjusted EBITDA also grew by 6%. Lamb Weston Holdings, Inc. (NYSE:LW) is also focusing on its previously announced restructuring plan. It is on track to deliver at least $55 million in pretax savings in fiscal 2025 and $85 million in pretax savings in fiscal 2026.

On April 7, Barclays analyst Andrew Lazar maintained a Buy rating on Lamb Weston Holdings, Inc. (NYSE:LW) and set a price target of $69.00. The analyst told investors that while global markets plummeted due to a potentially imminent tariff war, Lamb Weston Holdings, Inc. (NYSE:LW) rose around 10% after its earnings beat for fiscal Q3 2025. The analyst also said that the company maintained its positive full-year outlook, supported by ongoing product innovation initiatives and significant cost-saving measures brought about by a restructuring plan. Its strategic initiatives and control over operational improvements rank it fourth on our list of the top packaged food stocks to invest in.

Overall, LW ranks 4th on our list of best packaged food stocks to buy now. While we acknowledge the potential for LW as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than LW but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.