Lowe’s Stock Could Blast forty % Higher, According to Analyst
A prominent Lowe’s (NYSE:LOW) bull is actually charging harder on the company’s stock. Morgan Stanley analyst Simeon Gutman on Friday raised his price target on the home improvement retailer, upping it to $210 per share from the preceding $190 while maintaining his overweight (read: buy) recommendation.
The new objective is roughly forty % higher than Lowe’s most recent closing stock price.
Gutman made his revision on the notion that the current typical analyst earnings projections for the business underestimate a critical factor: need for home improvement goods and 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 feel [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit and loss]. This’s not appreciated by the market,” he have written in his latest research note on the company.
Gutman feels the broader DIY list landscapes will generally benefit 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 thirteen % for Lowe’s and 6 % for Home Depot.
The Morgan Stanley analyst in addition has raised his price target for Home Depot inventory, nonetheless, not as considerably. It’s currently $300, out of the former $295. The brand new level is actually fourteen % above Home Depot’s most recent closing stock price.
Neither business 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 %.
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