Lowe’s Stock Could Blast 40 % 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 the price target of his on the do retailer, upping it to $210 per share from the previous $190 while keeping his obese (read: buy) recommendation.
The new objective is around 40 % higher compared to Lowe’s most recent closing stock price.
Gutman made his revision on the notion that the present average analyst earnings projections for the business enterprise underestimate a critical factor: need for home improvement goods and services. The prognosticator feels it’s realistic that Lowe’s is going to hit the goal of its of a twelve % EBIT (earnings before interest as well as taxes) margin in 2021.
“Indeed, we think [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit as well as loss]. This is not valued by the market,” he have written in his latest research note on the company.
Gutman feels the broader DIY retail landscapes will typically gain from the anticipated rise in 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 6 % for Home Depot.
The Morgan Stanley analyst has also raised the price target of his for Home Depot inventory, even thought not as significantly. It is now $300, from 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 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 nearly 1.6 %.
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