Lowe’s Stock Could Blast forty % 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 previous $190 while maintaining his obese (read: buy) recommendation.
The new goal is approximately 40 % higher than Lowe’s most recent closing stock price.
Gutman made the modification of his on the perception that the present typical analyst earnings projections for the business enterprise underestimate a critical factor: need for home improvement goods and services. The prognosticator feels it’s reasonable that Lowe’s is going to hit the goal of its of a twelve % EBIT (earnings before interest and taxes) margin in 2021.
“Indeed, we feel [Lowe’s] will nearly reach it in 2020 on a’ normalized’ [profit as well as loss]. This’s not appreciated by the market,” he published in the latest research note of his on the business.
Gutman feels the broader DIY retail landscapes will generally gain 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 13 % for Lowe’s and six % for Home Depot.
The Morgan Stanley analyst in addition has raised the price target of his for Home Depot stock, although not as considerably. It is now $300, from the former $295. The brand new level is actually fourteen % above Home Depot’s most recent closing stock price.
Neither company 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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