Lowe’s Stock Could Blast forty % Higher, Based on 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 do retailer, upping it to $210 per share from the previous $190 while maintaining his overweight (read: buy) recommendation.
The brand new target is roughly 40 % higher than Lowe’s most recent closing stock price.
Gutman made the revision of his on the belief 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 is realistic that Lowe’s is going to hit the target of its of a 12 % EBIT (earnings before interest as well as 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 latest research note of his on the company.
Gutman thinks the broader DIY list landscape will typically benefit from the anticipated increase in 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, however, not as considerably. It is currently $300, out of the former $295. The new level is actually 14 % above Home Depot’s most recent closing stock price.
Neither business 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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