12 Best Pizza Stocks to Buy According to Hedge Funds

10. Lifeway Foods, Inc. (NASDAQ:LWAY)

Hedge Fund Holders: 18

Lifeway Foods, Inc. (NASDAQ:LWAY) produces and markets probiotic-based products in the US and internationally. Its primary product is a drinkable kefir, a cultural dairy product. The company’s product categories include various European-style soft cheeses, such as farmer and white cheese. The company markets its products under the Fresh Made, Lifeway, and Glen Oaks Farms brand names.

Its net sales reached $46.1 million in fiscal Q3 2024, an increase of 12.7% of $5.2 million compared to fiscal Q3 2023. This growth was primarily volume-driven by its branded drinkable kefir. Fiscal Q3 2024 marked the company’s 20th consecutive quarter of quarterly net sales growth, reflecting five consecutive years of quarterly growth.

Lifeway Foods, Inc., (NASDAQ:LWAY) plans to continue this growth momentum. It is focusing its capital spending on three core areas: cost reductions, growth, and facility improvements. The company has the capacity and operations to support continued rapid sales growth.

With an increasing trend of customers seeking value and high-quality nutritious products at affordable prices, Lifeway Foods, Inc.’s (NASDAQ:LWAY) products are becoming more popular. It is strategically investing in its Lifeway Farmer Cheese, which is protein-rich and full of probiotics and bioavailable nutrients. Consumer demand for the company’s soft cheese products is expected to remain high due to these qualities. In fiscal Q1 2025, the company’s Farmer Cheese will, for the first time, gain mass market placement in an estimated 1,400 stores at a large national retail part.

Rewey Asset Management stated the following regarding Lifeway Foods, Inc. (NASDAQ:LWAY) in its Q3 2024 investor letter:

“Lifeway Foods, Inc. (NASDAQ:LWAY) was our top percentage gainer in the quarter, up an astounding 103%! We often write about how the power of investing in neglect is equally important to investing in low valuations, and LWAY demonstrated this point in 3Q24. We purchased LWAY in 2Q24 as shares sold off despite a strong quarter that demonstrated continued revenue growth and margin expansion, despite a slight ‘miss’ to street EPS estimates. In our view, there was nothing bad about 2Q24, other than inaccurate sell side models. On August 13th, LWAY blew away these low expectations with a strong FY3Q report, where revenues grew over 25%, surpassing $50 million in a quarter for the first time. Shares further surged on Sept 23rd, when Danone, the global dairy company that owns 23.36% of the company, made an unsolicited bid for the company at $25 per share. While we think a deal may eventually get done, we think this first offer of $25 is too low.”