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Lifeway Foods, Inc. (LWAY) Research Update Released

(August 22, 2014)

Lifeway Foods, Inc. (LWAY) Research Update Released

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New York, NY - August 22, 2014 ( newswire) Taglich Brothers released an updated research report on Lifeway Foods, Inc. (LWAY) and reiterated a Speculative Buy rating with a 12-month price target of $16.45 per share . The report noted the following key investment considerations:

  • Lifeway Foods' brand awareness campaign, nationwide distribution, and European and Canadian sales should drive three-year annualized sales growth of 19% to $150.3 million by 2015. Our projections reflect distribution of LWAY's frozen Kefir through 6,000 US stores, up from approximately 4,000 in 2013, distribution at London-based retailers Harvey Nichols and Holland & Barrett, and Canadian distribution to 1,000 stores starting in 3Q14.
  • Distribution to mainstream stores such as Target nationwide and Costco in New England should support Kefir growth. US Wal-Mart supercenter grocery stores began carrying Lifeway products 2013. Driving sales to existing customers are new products -- Green Kefir, Blast, Bites for babies, Lifeway Veggie Kefir.
  • 2Q14 gross sales (reported on 8/11/14) increased 26.1% to $32.6 million, $2.5 million above our forecast. LWAY's profit was $0.07 per share vs. $0.09 in the year-earlier quarter. We projected EPS of $0.01 per share. The EPS decrease from last year stems from a 30% increase in milk prices and a 28% increase in selling expenses to $3.7 million.
  • We increased our 2014 sales forecast by $2.3 million to $128.4 million to reflect 2Q14 results. We decreased our 2014 EPS projection to $0.26 from $0.30 per share due to higher than anticipated selling expenses to $14.7 million from our prior forecast of $12.2 million, partly offset by efficiencies from a recently purchased manufacturing facility in Wisconsin.
  • In 2015 we project sales growth of 15% to $150.3 million and EPS of $0.48 per share, our prior EPS forecast was $0.52 per share on sales of $149.2 million. Growth reflects expanded sales in Europe and distribution in Canada. We anticipate income will benefit from a reduction in milk prices relative to 2014 and a full year benefit from production of its new manufacturing facility in Wisconsin.

The full report can be viewed at

Company Description:

Lifeway Foods, Inc., (LWAY) based in Morton Grove, Illinois is a manufacturer of cultured, probiotic and functional food products in the health food industry, and is America's leading supplier of the cultured dairy product known as kefir. Their products are sold to health conscious consumers through health food stores and to the mass-market consumers through supermarkets.

Taglich Brothers:

Taglich Brothers, Inc. is full-service broker dealer focused exclusively on microcap companies. The Company defines the microcap segment of the equity market as companies with less than $250 million in market capitalization. Taglich Brothers currently offers institutional and retail brokerage services, investment banking and comprehensive research coverage to the investment community.

The Taglich Brothers' Equity Research department is dedicated to providing research reports that are informative, insightful and illuminating. Reports are designed to distill volumes of investment information into a concise, straightforward format so that busy professional investors can make informed investment decisions.


The information and statistical data contained herein have been obtained from sources, which we believe to be reliable but in no way are warranted by us as to accuracy or completeness. We do not undertake to advise you as to changes in figures or our views. This is not a solicitation of any order to buy or sell. Taglich Brothers, Inc. is fully disclosed with its clearing firm, Pershing, LLC, is not a market maker and does not sell to or buy from customers on a principal basis. The above statements are the opinion of Taglich Brothers, Inc. and are not a guarantee that the target price for the stock will be met or that predicted business results for the company will occur. There may be instances when fundamental, technical and quantitative opinions contained in the reports are not in concert. We, our affiliates, any officer, director or stockholder or any member of their families may from time to time purchase or sell any of the above-mentioned or related securities. Analysts and members of the Research Department are prohibited from buying or selling securities issued by the companies that Taglich Brothers, Inc. has a research relationship with, except if ownership of such securities was prior to the start of such relationship, then an Analyst or member of the Research Department may sell such securities after obtaining expressed written permission from Compliance. All research issued by Taglich Brothers, Inc. is based on public information. Taglich Brothers, Inc. does not currently have an Investment Banking relationship with the company mentioned and was not a manager or co-manager of any offering for the company within the last three years. In September 2012 the company paid an initial monetary engagement fee of US$4,500 to Taglich Brothers, Inc. representing payment for the first three months of creation and dissemination of research reports, after which the company will pay Taglich Brothers, Inc. a monetary fee of US$1,500 per month for a minimum of three more months for such services.For further information and Taglich Brothers, Inc. ownership data please refer to each individual report.


Richard Oh

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