Lowe’s Stock Could Blast forty % Higher, Based on Analyst
A prominent Lowe’s (NYSE:LOW) bull is charging harder on the company’s stock. Morgan Stanley analyst Simeon Gutman on Friday raised the price target of his on the do retailer, upping it to $210 per share from the prior $190 while keeping his overweight (read: buy) recommendation.
The brand new goal is around 40 % higher compared to Lowe’s most recent closing stock price.
Gutman made the modification of his on the belief that the current typical analyst earnings projections for the business enterprise underestimate an important factor: demand for home improvement goods as well as services. The prognosticator feels it’s realistic that Lowe’s will hit the goal of its of a 12 % EBIT (earnings before interest as well as taxes) margin in 2021.
“Indeed, we feel [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit and loss]. This is not appreciated by the market,” he have written in the newest research note of his on the company.
Gutman thinks the broader DIY list landscape will generally benefit from the anticipated rise in demand. As a result, the per-share earnings estimates of his 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 has also raised the price target of his for Home Depot inventory, nevertheless, not as significantly. It’s now $300, out of the former $295. The new level is fourteen % above Home Depot’s most recent closing stock price.
Neither business enterprise had a memorable day in the market place 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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