Lowe’s Stock Could Blast forty % 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 the price target of his on the home improvement retailer, upping it to $210 per share from the previous $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 revision of his on the perception 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’s realistic that Lowe’s will hit the target of its of a twelve % EBIT (earnings before interest and taxes) margin in 2021.
“Indeed, we feel [Lowe’s] will almost reach it in 2020 on a’ normalized’ [profit as well as loss]. This is not valued by the market,” he have written in his newest research note on the business.
Gutman feels the broader DIY list landscapes will typically gain from the anticipated increasing amount of demand. To be 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 six % for Home Depot.
The Morgan Stanley analyst has additionally raised his price target for Home Depot stock, however, not as considerably. It’s currently $300, out of the former $295. The 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 nearly 1.6 %.
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