Especially to you, Howard...I haven't had much nice to say about LWAY in a while...if they string a few more quarters together like this past one, they will be living up to their promise. All they need to do is focus on their business and quit trying to spend their way to success...they are agruably already succesful where it really counts. -Randy
Randy,It was an interesting one, wasn't it? Kind of the opposite of what's become the norm. Instead of 20%+ revenue growth, it was low teens. But instead of all of the money being spent, it was a big jump in profitability. Maybe they finally have spent what they feel they need on advertising, shelf space, etc. BUT, I'm skeptical. They mentioned low milk prices as the reason. That just confirms that they will be completely dependent on that commodity cost...I've still held some, and really like this product. So I want the company to flourish, but count me as still skeptical. Plus I recently saw a new competing line of kefir in my grocery store...I'll continue to follow it. Howard
Hi Howard- there has been competition for Lifeway for at least 3 years now. The fact that it's held its own is a very good sign. Expansion into the frozen category may help them. I can get a read on that from where I am, and I'll report my impressions over the coming eons. It's not a very impressive product, but then IMO either is the drink (just talking "wow" factor here, not product quality). Kefir obviously has its fans and if they'll cross the aisle to the freezer, perhaps it will be easy money for the company. The frozen kefir is hitting the shelves right now. I'm sure there will be promotions in another few weeks, then we'll see how it moves off the shelf on an every day basis.As far as low milk prices are concerned, I think that's always been BS. But at least they are consistent. If it's really true, strap on your hat for a couple of lousy quarters, because milk has been on the rise for the past 3 months and there is no end in sight. Surely milk cost has an effect, but their biggest expenses are in marketing (especially marginal products that may or may not exist anymore...like lassi...is that still out there?)-Randy
Thanks for the reply, Randy. The frozen kefir is hitting the shelves right now. I'm sure there will be promotions in another few weeks, then we'll see how it moves off the shelf on an every day basis.I love the drink, but don't keep it as a staple. I'm also an ice cream freak. I can tell you that if it shows up at my grocer, I'll be getting it instead of ice cream or frozen yogurt (unless it's too expensive - but I'm willing to pay a little more).H.
FWIW, here's my $0.02:http://www.fool.com/investing/small-cap/2012/08/16/lifeway-c...
That fro-yo is pretty expensive...I picked some up at my co-op (not to eat, just to see how it feels, what's on the label, etc.) and I will suggest that if it sells, Lifeway has a true following of brand loyalists. It doesn't look like anything to write home about. Then as I had my head in the dairy cooler, I see they have another product I'd never heard of...looks like concentrated yogurt (or maybe concentrated b.s.); 4 little bottles in the pack for about six bucks. They must be going after the Red Bull type crowd...yeah, yogurt shots...that's the ticket! Same deal though...if it sells, it proves they have brand loyalty. It's worth watching...and it's a natural line extension...and the price of milk will have very little impact on the cost of those wee buggers.-Randy
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