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Lowe's Companies (LOW)
NYSE:LOW
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Lowe's
(NYSE:LOW)59Neutral
Positive Factors
Earnings
Lowe's reported a better-than-expected adjusted EPS driven by higher-than-expected comp sales, including strong seasonal DIY performance.
Innovation and Customer Experience
Expanded same-day delivery options and an enhanced mobile app experience are working, with new tools like an AI-powered home improvement advisor on Lowe's.com expected to lift conversion and units per transaction.
Negative Factors
Weather Impact
A slow start to the first quarter due to weather has caused a 150 basis points drag on comps in January, persisting into February, although recovery-related spend is expected to materialize and spill over into the second quarter.
Lowe's (LOW) vs. S&P 500 (SPY)
Market Cap
$137.19B
Dividend Yield1.87%
Average Volume (3M)2.47M
Price to Earnings (P/E)19.9
Beta (1Y)1.03
Revenue Growth-3.13%
EPS Growth-7.21%
CountryUS
Employees284,000
SectorConsumer Cyclical
Sector Strength53
IndustryRetail - Discretionary
Share Statistics
EPS (TTM)12.21
Shares Outstanding564,650,000
10 Day Avg. Volume3,408,486
30 Day Avg. Volume2,474,742
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.64
Price to Cash Flow (P/CF)26.40
P/FCF Ratio47.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$285.50Price Target Upside17.65% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering22
Lowe's Business Overview & Revenue Model
Company DescriptionLowe's Companies, Inc. is a leading home improvement retailer operating primarily in the United States and Canada. Established in 1946, Lowe's offers a wide range of products for home improvement, maintenance, repair, and remodeling. The company's product offerings include appliances, tools, hardware, paint, lumber, lawn and garden supplies, and other related merchandise. Lowe's serves both retail consumers and professional customers such as contractors, builders, and repair professionals.
How the Company Makes MoneyLowe's generates revenue primarily through the sale of home improvement products in its vast network of retail stores and through its e-commerce platform. The company earns money by offering a diverse range of products across categories such as appliances, building materials, paint, and outdoor living. Additionally, Lowe's has developed a strong presence in the professional customer segment by providing services and products tailored to the needs of contractors and repair specialists. Revenue is further supplemented by installation and delivery services, which provide convenience to customers seeking a comprehensive home improvement solution. Partnerships with various suppliers and exclusive brand offerings also play a significant role in enhancing Lowe's product assortment and profit margins.
Lowe's Financial Statement Overview
Summary
Lowe's shows strong operational efficiencies and cash flow management, but high leverage and declining revenues pose risks. Strategic focus on improving revenue and managing debt is crucial for future stability.Income Statement
Lowe's has shown strong profitability with a consistent gross profit margin, though recent revenue growth has been negative. The TTM EBIT and EBITDA margins are healthy, reflecting efficient operations despite declining revenues.70
Positive
Balance Sheet
The balance sheet shows high leverage with a negative equity, indicating financial risk. The debt-to-equity ratio is concerning, suggesting potential instability. However, the company's ability to generate profit with these resources is notable.45
Neutral
Cash Flow
Operating cash flow is robust relative to net income, indicating strong cash-generating capabilities. However, the growth in free cash flow is modest, and the significant financing cash outflows may limit flexibility.60
Neutral
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 83.72B | 86.38B | 97.06B | 96.25B | 89.60B | 72.15B | Gross Profit |
| 26.94B | 28.84B | 32.26B | 32.06B | 29.57B | 22.94B | EBIT |
| 10.40B | 11.56B | 10.16B | 12.09B | 9.65B | 6.31B | EBITDA |
| 12.36B | 13.57B | 12.69B | 14.47B | 11.24B | 8.22B | Net Income Common Stockholders |
| 6.85B | 7.73B | 6.44B | 8.44B | 5.83B | 4.28B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 729.00M | 921.00M | 1.73B | 1.40B | 5.20B | 876.00M | Total Assets |
| 34.51B | 41.80B | 43.71B | 44.64B | 46.73B | 39.47B | Total Debt |
| 16.22B | 40.15B | 37.99B | 29.38B | 26.21B | 23.75B | Net Debt |
| 15.71B | 39.22B | 36.65B | 28.25B | 21.52B | 23.03B | Total Liabilities |
| 30.86B | 56.84B | 57.96B | 49.46B | 45.30B | 37.50B | Stockholders Equity |
| 3.64B | -15.05B | -14.25B | -4.82B | 1.44B | 1.97B |
| Cash Flow | Free Cash Flow | ||||
| 7.82B | 6.18B | 6.76B | 8.26B | 9.26B | 2.81B | Operating Cash Flow |
| 9.82B | 8.14B | 8.59B | 10.11B | 11.05B | 4.30B | Investing Cash Flow |
| -1.92B | -1.90B | -1.31B | -1.65B | -1.89B | -1.37B | Financing Cash Flow |
| -5.85B | -6.67B | -7.05B | -12.02B | -5.19B | -2.73B |
Lowe's Technical Analysis
Negative
242.66
Price Trends
251.29
Negative
259.26
Negative
247.69
Negative
Market Momentum
-3.29
Positive
42.49
Neutral
39.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOW, the sentiment is Negative. The current price of 242.66 is below the 20-day moving average (MA) of 246.95, below the 50-day MA of 251.29, and below the 200-day MA of 247.69, indicating a bearish trend. The MACD of -3.29 indicates Positive momentum. The RSI at 42.49 is Neutral, neither overbought nor oversold. The STOCH value of 39.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOW.
Lowe's Risk Analysis
Lowe's disclosed 25 risk factors in its most recent earnings report. Lowe's reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lowe's Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $23.10B | 22.19 | 58.86% | 1.25% | -5.00% | 17.77% | |
72 Outperform | $29.21B | 26.93 | 49.83% | 1.63% | 2.25% | 1.00% | |
68 Neutral | $383.79B | 25.91 | 385.37% | 2.36% | 4.48% | -1.27% | |
61 Neutral | $9.45B | 47.52 | 10.04% | ― | 0.95% | -16.97% | |
60 Neutral | $13.01B | 10.45 | 0.79% | 3.53% | 1.60% | -22.47% | |
59 Neutral | $137.19B | 19.88 | -51.07% | 1.87% | -3.13% | -7.21% | |
47 Neutral | $5.39B | 80.64 | -38.18% | ― | 1.41% | -62.21% |
* Consumer Cyclical Sector Average
Performance Comparison
LOW
Lowe's
242.66
5.07
2.13%
HD
Home Depot
376.80
8.27
2.24%
TSCO
Tractor Supply
56.89
7.59
15.40%
WSM
Williams-Sonoma
188.41
72.68
62.80%
RH
RH
262.43
-14.53
-5.25%
FND
Floor & Decor Holdings
91.21
-33.05
-26.60%
Lowe's Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: 0.11% | Next Earnings Date: May 21, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong performance in sales, especially in the pro and online segments. Loyalty programs and technology advancements were significant achievements. However, ongoing challenges in the macro environment and pressure on DIY discretionary spending were notable concerns. Despite these challenges, Lowe's remains confident in its strategic initiatives to drive future growth.Highlights
Strong Sales Performance
Lowe's delivered sales of $18.6 billion in Q4 2024, with positive comparable sales of 0.2%. For the full fiscal year 2024, sales were $83.7 billion with an adjusted operating margin of 12.3% and adjusted earnings per share of $11.99.
Pro Segment Growth
High single-digit comps in the pro segment for the second consecutive quarter, driven by initiatives like TransformPro offering and MyLowe's Pro Rewards.
Online Sales Surge
Online sales grew by 9.5% in Q4, with record-breaking sales during Black Friday and Cyber Monday, reflecting strong omnichannel investments.
Loyalty Program Success
MyLowe's Rewards loyalty program reached 30 million members, with members outspending nonmembers by nearly 50%.
Innovation and Technology
Forrester rated Lowe's mobile app as the overall digital experience leader in US retail mobile apps. Launch of AI-powered home improvement virtual advisor in collaboration with OpenAI.
Lowlights
DIY Discretionary Spending Pressure
Continued near-term pressure on DIY discretionary spending, particularly in bigger ticket projects, due to a cautious consumer environment.
Challenging Macro Environment
High mortgage rates and low existing home sales create a difficult market, with an anticipated flat home improvement market in 2025.
Weather Impact
Unfavorable winter weather in January and February negatively impacted sales, particularly in southern markets.
Company Guidance
In the fourth quarter of 2024, Lowe's Companies, Inc. reported sales of $18.6 billion with comparable sales growth of 0.2%. The entire fiscal year saw sales reach $83.7 billion, with an adjusted operating margin of 12.3% and adjusted earnings per share of $11.99. The company highlighted strong performance in its pro segment with high single-digit comps for the second consecutive quarter, spurred by its TransformPro offering and the nationwide launch of the redesigned pro loyalty program, MyLowe's Pro Rewards. Online sales grew significantly by 9.5% in Q4, driven by record-breaking sales during Black Friday and Cyber Monday. For fiscal 2025, Lowe's anticipates sales between $83.5 billion and $84.5 billion, with comparable sales growth from flat to 1%, and an operating margin of 12.3% to 12.4%. The company plans significant investments in its Total Home strategy, aiming for a billion dollars in productivity gains, and projects full-year diluted earnings per share between $12.15 and $12.40.Lowe's Corporate Events
Business Operations and StrategyFinancial Disclosures
Lowe’s Unveils 2025 Total Home Strategy for Growth
Positive
Dec 11, 2024
Lowe’s has unveiled its 2025 Total Home Strategy at its Analyst and Investor Conference, focusing on growth initiatives such as driving Pro penetration, accelerating online sales, expanding home services, creating a loyalty ecosystem, and increasing space productivity. The company is also enhancing its operations with a new AI framework, launching a product marketplace, and expanding its store footprint, while providing financial updates and scenario planning for 2025, aiming for long-term growth and enhanced shareholder value.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.