Lowe's logged a -1.1% change during today's afternoon session, and is now trading at a price of $238.93 per share.
Lowe's returned losses of -11.6% last year, with its stock price reaching a high of $287.01 and a low of $206.39. Over the same period, the stock underperformed the S&P 500 index by -28.8%. AThe company's 50-day average price was $253.53. Lowe's Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States. Based in Mooresville, NC, the Large-Cap Consumer Discretionary company has 300,000 full time employees. Lowe's has offered a 1.9% dividend yield over the last 12 months.
Good EPS Growth at the Expense of a Highly Leveraged Balance Sheet:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $72,148 | $89,597 | $96,250 | $97,059 | $86,377 | $83,674 |
| Gross Margins | 32% | 33% | 33% | 33% | 33% | 33% |
| Net Margins | 6% | 7% | 9% | 7% | 9% | 8% |
| Net Income (M) | $4,281 | $5,835 | $8,442 | $6,437 | $7,726 | $6,957 |
| Net Interest Expense (M) | $21 | $20 | $26 | $19 | $9 | -$1,313 |
| Depreciation & Amort. (M) | $1,262 | $1,399 | $1,662 | $1,766 | $1,717 | $1,729 |
| Diluted Shares (M) | 754 | 692 | 620 | 577 | 566 | 560 |
| Earnings Per Share | $5.49 | $7.75 | $12.04 | $10.17 | $13.2 | $12.23 |
| EPS Growth | n/a | 41.17% | 55.35% | -15.53% | 29.79% | -7.35% |
| Avg. Price | $99.35 | $128.86 | $194.71 | $205.24 | $222.55 | $241.67 |
| P/E Ratio | 18.1 | 16.58 | 16.13 | 20.12 | 16.82 | 19.73 |
| Free Cash Flow (M) | $2,812 | $9,258 | $8,260 | $6,760 | $6,176 | $7,698 |
| CAPEX (M) | $1,484 | $1,791 | $1,853 | $1,829 | $1,964 | $1,927 |
| EV / EBITDA | 13.82 | 11.85 | 13.26 | 15.89 | 14.49 | 16.44 |
| Total Debt (M) | $37,953 | $44,549 | $56,763 | $68,250 | $68,290 | $68,220 |
| Net Debt / EBITDA | 3.92 | 3.48 | 3.89 | 5.62 | 4.9 | 5.34 |
| Current Ratio | 1.38 | 1.19 | 1.2 | 1.21 | 1.13 | 1.01 |
Lowe's has slight revenue growth and increasing reinvestment in the business, a strong EPS growth trend, and generally positive cash flows. However, the firm has a highly leveraged balance sheet. Finally, we note that Lowe's has similar gross margins to its peers and just enough current assets to cover current liabilities, as shown by its current ratio of 1.01.
Lowe's Is Too Expensive at Current Levels:
Lowe's has a trailing twelve month P/E ratio of 20.8, compared to an average of 20.93 for the Consumer Discretionary sector. Based on its EPS guidance of $12.63, the company has a forward P/E ratio of 20.1. The 12.6% compound average growth rate of Lowe's's historical and projected earnings per share yields a PEG ratio of 1.65. This suggests that these shares are overvalued.
Lowe's Has an Average Rating of Buy:
The 32 analysts following Lowe's have set target prices ranging from $221.0 to $325.0 per share, for an average of $283.16 with a buy rating. The company is trading -15.6% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Lowe's has a very low short interest because 1.7% of the company's shares are sold short. Institutions own 79.2% of the company's shares, and the insider ownership rate stands at 0.11%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 10% stake in the company is worth $13,135,225,786.
