Lowe’s Stock Could Blast 40 % Higher, As reported by 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 do retailer, upping it to $210 per share from the earlier $190 while keeping his overweight (read: buy) recommendation.
The new goal is roughly forty % higher compared to Lowe’s most recent closing stock price.
Gutman made the revision of his on the notion that the current average analyst earnings projections for the company underestimate a crucial factor: demand for home improvement goods as well as services. The prognosticator feels it is reasonable that Lowe’s will hit its goal of a 12 % 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 valued by the market,” he have written in the newest research note of his on the business.
Gutman believes the broader DIY retail landscapes will generally gain from the anticipated increasing amount of 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 13 % for Lowe’s and six % for Home Depot.
The Morgan Stanley analyst has also raised the price target of his for Home Depot stock, even thought not as significantly. It’s currently $300, out of the former $295. The brand new level is actually 14 % 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 nearly 1.6 %.
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