Lowe’s Stock Could Blast 40 % Higher, According to Analyst
A prominent Lowe’s (NYSE:LOW) bull is charging harder on the company’s stock. Morgan Stanley analyst Simeon Gutman on Friday raised his price target on the do retailer, upping it to $210 per share from the prior $190 while maintaining his overweight (read: buy) recommendation.
The brand new objective is approximately 40 % higher than Lowe’s most recent closing stock price.
Gutman made his modification on the perception that the current average analyst earnings projections for the business enterprise underestimate a crucial factor: demand for home improvement goods as well as services. The prognosticator feels it is practical that Lowe’s is going to hit its target of a twelve % EBIT (earnings before interest and taxes) margin in 2021.
“Indeed, we believe [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit and loss]. This’s not valued by the market,” he had written in the latest research note of his on the company.
Gutman believes the broader DIY list landscapes will generally reap some benefits from the anticipated rise in demand. To be a result, his per-share earnings estimates for both Lowe’s and its arch-rival Home Depot (NYSE:HD) are notably above the average for prognosticators following those stocks — by 13 % for Lowe’s and 6 % for Home Depot.
The Morgan Stanley analyst has additionally raised his price target for Home Depot inventory, though not as drastically. It’s now $300, out of the former $295. The brand new level is fourteen % above Home Depot’s most recent closing stock price.
Neither company had a memorable day in the market on Friday. Lowe’s shares fell by 1.3 %, against the 0.9 % gain of the S&P 500 index. Home Depot declined by almost 1.6 %.
Where you can invest $1,000 right now Before you decide to think about Lowe’s Companies, Inc., you’ll want to hear this.
Investing legend and FintechZoom Co-founder Pedro Vaz just revealed what he believes are actually the 10 greatest stocks for investors to purchase right now… and Lowe’s Companies, Inc. wasn’t one of them.