Lowe’s Stock Could Blast 40 % Higher, As reported by Analyst
A prominent Lowe’s (NYSE:LOW) bull is charging harder on the company’s stock. Morgan Stanley analyst Simeon Gutman on Friday raised his price target on the home improvement retailer, upping it to $210 per share from the preceding $190 while maintaining his overweight (read: buy) recommendation.
The new goal is exactly 40 % higher than Lowe’s most recent closing stock price.
Gutman made the revision of his on the belief that the current average analyst earnings projections for the business underestimate a crucial factor: need for home improvement goods as well as services. The prognosticator feels it’s realistic that Lowe’s is going to hit the goal of its of a 12 % EBIT (earnings before interest and taxes) margin in 2021.
“Indeed, we believe [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit and loss]. This is not appreciated by the market,” he published in his newest research note on the business.
Gutman believes the broader DIY list landscape will generally reap some benefits from the anticipated rise in demand. As 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 6 % for Home Depot.
The Morgan Stanley analyst in addition has raised the price target of his for Home Depot stock, however, not as considerably. It’s these days $300, from the former $295. The brand 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 nearly 1.6 %.
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