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 the price target of his on the do retailer, upping it to $210 per share from the prior $190 while maintaining his overweight (read: buy) recommendation.
The brand new target is exactly forty % higher than Lowe’s most recent closing stock price.
Gutman made his revision on the notion that the current average analyst earnings projections for the business enterprise underestimate a crucial factor: need for home improvement goods as well as services. The prognosticator feels it’s reasonable that Lowe’s is going to hit the goal of its of a 12 % 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 and loss]. This is not valued by the market,” he had written in his latest research note on the business.
Gutman believes the broader DIY list landscapes will typically gain from the anticipated rise in 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 6 % for Home Depot.
The Morgan Stanley analyst in addition has raised his price target for Home Depot stock, nonetheless, not as significantly. It is now $300, out of the former $295. The brand 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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