MeritValue

Lifeway Foods, Inc.

LWAYdata completeness 88%16 fiscal years on file
The thesis, from the filings

Lifeway Foods, Inc. earns about 13% on invested capital, comfortably above its ~9% cost of capital, with a roughly flat share count — a real edge showing up in the numbers. The estimate methods put fair value between $6.02 and $24.08 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$119.1M1$141.6M2$160.1M3$186.8M4$212.5M4
Net income$3.31M5$924,0006$11.4M7$9.03M8$13.9M8
Operating cash flow$5.56M9$3.99M10$16.9M11$13M12$10.9M12
Capital expenditure$1.92M13$3.45M14$4.35M15$6.7M16$27.4M16
Free cash flow (derived)$3.64M9$538,00010$12.6M11$6.27M12−$16.4M12
Total debt$8.97M17$7.48M17$2.75M18——
Cash & equivalents$9.23M19$4.44M20$13.2M21$16.7M22$5.57M22
Diluted shares15.8M15.7M15.1M15.1M15.5M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$55.23
your share of equity
Profit it earned you last year
$8.92
Free cash flow it threw off
−$10.56
Debt you’d be carrying
—

10 shares is a claim on $55.23 of net worth that earned you $8.92 and generated −$10.56 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
13% avg · 5y
FY21 7%FY22 2%FY23 23%FY24 16%FY25 17%

It earned about 13% on invested capital against a ~9% cost of capital — comfortably above the cost of funding, a moderate advantage.

seeing a moat in the numbers →
Management signal · capital allocation
−1% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has fallen 69% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $6.02 and $24.08 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$24.08
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth19.8%
  • fcfBase$6.27M
DCF · Growth Exit 5Y
$13.41
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth19.8%
  • fcfBase$6.27M
Earnings Power Value
$6.02
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$9.03M
  • growthAssumed0.0%
Graham Number
$10.52
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years19.8%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $13.41
The three cases
Bear0.0%$6.12
Base19.8%$13.41
Bull20.0%$13.5

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 19.8%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001683168-24-001564 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001683168-25-001592 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2024-12-31 · accession 0001683168-26-001886 (RevenueFromContractWithCustomerExcludingAssessedTax)
  5. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (NetIncomeLoss)
  6. 10-K · period ending 2022-12-31 · accession 0001683168-24-001564 (NetIncomeLoss)
  7. 10-K · period ending 2023-12-31 · accession 0001683168-25-001592 (NetIncomeLoss)
  8. 10-K · period ending 2024-12-31 · accession 0001683168-26-001886 (NetIncomeLoss)
  9. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2022-12-31 · accession 0001683168-24-001564 (NetCashProvidedByUsedInOperatingActivities)
  11. 10-K · period ending 2023-12-31 · accession 0001683168-25-001592 (NetCashProvidedByUsedInOperatingActivities)
  12. 10-K · period ending 2024-12-31 · accession 0001683168-26-001886 (NetCashProvidedByUsedInOperatingActivities)
  13. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (PaymentsToAcquirePropertyPlantAndEquipment)
  14. 10-K · period ending 2022-12-31 · accession 0001683168-24-001564 (PaymentsToAcquirePropertyPlantAndEquipment)
  15. 10-K · period ending 2023-12-31 · accession 0001683168-25-001592 (PaymentsToAcquirePropertyPlantAndEquipment)
  16. 10-K · period ending 2024-12-31 · accession 0001683168-26-001886 (PaymentsToAcquirePropertyPlantAndEquipment)
  17. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (LongTermDebtNoncurrent)
  18. 10-K · period ending 2023-12-31 · accession 0001683168-24-001564 (LongTermDebt)
  19. 10-K · period ending 2021-12-31 · accession 0001683168-23-001804 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2022-12-31 · accession 0001683168-24-001564 (CashAndCashEquivalentsAtCarryingValue)
  21. 10-K · period ending 2023-12-31 · accession 0001683168-25-001592 (CashAndCashEquivalentsAtCarryingValue)
  22. 10-K · period ending 2024-12-31 · accession 0001683168-26-001886 (CashAndCashEquivalentsAtCarryingValue)