Lowe’s Stock Could Blast forty % 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 the price target of his on the home improvement retailer, upping it to $210 per share from the preceding $190 while maintaining his overweight (read: buy) recommendation.
The new objective is roughly 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 underestimate a crucial factor: demand for home improvement goods as well as services. The prognosticator feels it’s realistic that Lowe’s is going to hit its goal of a 12 % EBIT (earnings before interest and 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 the latest research note of his on the company.
Gutman believes the broader DIY list landscape will generally reap some benefits from the anticipated increasing amount of demand. Being 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 thirteen % for Lowe’s and six % for Home Depot.
The Morgan Stanley analyst in addition has raised the price target of his for Home Depot inventory, though not as dramatically. It is currently $300, from the former $295. The new level is fourteen % above Home Depot’s most recent closing stock price.
Neither business enterprise 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 almost 1.6 %.
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