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1. Company Snapshot

1.a. Company Description

Lowe's Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States and internationally.The company offers a line of products for construction, maintenance, repair, remodeling, and decorating.It provides home improvement products, such as appliances, seasonal and outdoor living, lawn and garden, lumber, kitchens and bath, tools, paint, millwork, hardware, flooring, rough plumbing, building materials, décor, lighting, and electrical.


It also offers installation services through independent contractors in various product categories; extended protection plans; and in-warranty and out-of-warranty repair services.The company sells its national brand-name merchandise and private brand products to homeowners, renters, and professional customers.As of January 28, 2022, it operated 1,971 home improvement and hardware stores.


The company also sells its products through websites comprising Lowes.com and Lowesforpros.com; and through mobile applications.Lowe's Companies, Inc.was founded in 1921 and is based in Mooresville, North Carolina.

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1.b. Last Insights on LOW

Lowe's Companies, Inc. faces concerning macroeconomic headwinds, including persistent consumer confidence and housing market challenges. The company's cautious FY27 outlook, despite strong Q4 performance, has raised concerns. Institutional investors, such as Oppenheimer Asset Management Inc. and Principal Financial Group Inc., have reduced their stakes in the company. Lowe's maintains a 1.9% dividend yield, with cash flow covering payouts, but has significantly reduced share buybacks. According to MarketBeat.com, the company has a consensus recommendation of "Moderate Buy" from brokerages.

1.c. Company Highlights

2. Lowe's Companies Delivers Mixed Results Amidst Volatile Housing Market

Lowe's Companies reported fourth-quarter sales of $20.6 billion and a 1.3% increase in comparable sales. For the fiscal year 2025, the company delivered sales of $86.3 billion, a 0.2% increase in comparable sales, and an adjusted operating margin of 12.1%, resulting in adjusted earnings per share of $12.28, a 2% increase over the previous year. The company's GAAP diluted earnings per share stood at $1.78, while adjusted diluted earnings per share was $1.98, beating estimates of $1.94.

Publication Date: Feb -26

📋 Highlights
  • Strong FY2025 Sales Growth:: Fiscal year 2025 sales reached $86.3 billion, with a 0.2% increase in comparable sales, and adjusted EPS rose 2% to $12.28.
  • Operational Efficiency Gains:: Free cash flow totaled $7.7 billion in 2025, and $1 billion in productivity savings are targeted for 2026 through PPI initiatives.
  • Pro Segment and Digital Growth:: Pro sales growth outpaced expectations, while online sales surged 10.5% in Q4, with record Black Friday/Cyber Monday performance.
  • Strategic Acquisitions Integration:: $3 billion spent on acquiring ADG and FBM, expected to generate $8 billion in 2026 revenue and accretive EPS growth.
  • 2026 Outlook Confidence:: Sales guidance of $92–$94 billion and adjusted EPS of $12.25–$12.75, with margin expansion to 11.6–11.8% despite flat market expectations.

Operational Highlights

In terms of business performance, Lowe's Pro results showed growth, driven by a transformed offering, investments in inventory, and enhanced service levels. Online sales grew 10.5% in the quarter, with the company setting new sales records on Black Friday and Cyber Monday. Home services delivered high single-digit growth, driven by digital tools and enhanced service. The company's Chief Financial Officer, Brandon Sink, noted that the recent acquisitions of Foundation Building Materials and Artisan Design Group are on track, with integration efforts focused on capturing cost synergies.

Strategic Initiatives

Lowe's has made significant investments in its Pro Extended Aisle and Total Home strategy. The company launched a full shelf replenishment initiative, using real-time data to identify out-of-stocks and prioritize restocking. This has improved the associate and customer experience. Lowe's Pro Extended Aisle efforts are exceeding expectations, with new suppliers and markets being added weekly.

Outlook and Guidance

For 2026, Lowe's expects sales ranging from $92 billion to $94 billion, with comparable sales flat to up 2%. The company anticipates operating margin in a range of 11.2% to 11.4% and adjusted operating margin in a range of 11.6% to 11.8%. Lowe's guides 2026 core business EBIT margin with a range that reflects a 2% comp, with the low end assuming flat comp and the high end assuming upside traction from sales-driving initiatives.

Valuation Metrics

With a P/E Ratio of 22.1 and an EV/EBITDA of 14.38, the market appears to be pricing in moderate growth expectations. The company's ROE is negative, but ROIC stands at 20.42%, indicating a strong return on invested capital. The Dividend Yield is 1.81%, and Free Cash Flow Yield is 5.19%, suggesting a relatively attractive return for income investors.

3. NewsRoom

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Lowe’s Companies, Inc. $LOW Stock Holdings Decreased by Empirical Financial Services LLC d.b.a. Empirical Wealth Management

09:09

Source: defenseworld.net

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Lowe's (LOW) Stock Drops Despite Market Gains: Important Facts to Note

Apr -02

Source: zacks.com

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Econ Financial Services Corp Takes $3.82 Million Position in Lowe’s Companies, Inc. $LOW

Apr -01

Source: defenseworld.net

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Foster & Motley Inc. Sells 3,972 Shares of Lowe’s Companies, Inc. $LOW

Apr -01

Source: defenseworld.net

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Exchange Traded Concepts LLC Sells 40,219 Shares of Lowe’s Companies, Inc. $LOW

Apr -01

Source: defenseworld.net

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The Best 3 Retail Stocks to Buy and Hold for Decades

Mar -31

Source: fool.com

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Financial Planning Hawaii Inc. Makes New Investment in Lowe’s Companies, Inc. $LOW

Mar -31

Source: defenseworld.net

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Canoe Financial LP Sells 31,180 Shares of Lowe’s Companies, Inc. $LOW

Mar -29

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.10%)

6. Segments

Home Improvement Operations

Expected Growth: 1.1%

The 1.1% growth rate is based on the global revenue growth hypothesis. Home Improvement Operations, being the core business, is expected to follow the overall company growth trend, driven by steady demand for home improvement products, and Lowe's continued efforts to enhance customer experience and expand its online presence.

7. Detailed Products

Lumber

Lowe's offers a wide range of lumber products, including dimensional lumber, plywood, oriented strand board (OSB), and pressure-treated lumber.

Building Materials

Lowe's provides a variety of building materials, including drywall, roofing materials, insulation, and siding.

Kitchen and Bath Fixtures

Lowe's offers a wide selection of kitchen and bath fixtures, including sinks, faucets, toilets, and shower systems.

Appliances

Lowe's sells a range of appliances, including refrigerators, ovens, dishwashers, and washing machines.

Paint and Decorating

Lowe's offers a variety of paint, stains, and decorating supplies, including brushes, rollers, and painting tools.

Lawn and Garden

Lowe's provides a range of lawn and garden products, including seeds, fertilizers, and gardening tools.

Tools and Hardware

Lowe's sells a variety of tools and hardware, including power tools, hand tools, and fasteners.

Smart Home and Security

Lowe's offers a range of smart home and security products, including thermostats, security cameras, and door locks.

Plumbing and Water Heaters

Lowe's provides a variety of plumbing and water heater products, including pipes, fittings, and water heater systems.

8. Lowe's Companies, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Lowe's faces moderate threat from substitutes, as customers can opt for alternative home improvement retailers or online marketplaces. However, the company's strong brand presence and wide product offerings mitigate this threat to some extent.

Bargaining Power Of Customers

Lowe's customers have relatively low bargaining power due to the company's large scale and diversified product offerings. Additionally, the home improvement retail market is highly competitive, which reduces customers' ability to negotiate prices.

Bargaining Power Of Suppliers

Lowe's suppliers have moderate bargaining power due to the company's dependence on a few large suppliers for certain products. However, Lowe's large scale and diversified supplier base mitigate this threat to some extent.

Threat Of New Entrants

The threat of new entrants is low in the home improvement retail market due to high barriers to entry, including significant capital requirements and the need for a large scale of operations to achieve economies of scale.

Intensity Of Rivalry

The home improvement retail market is highly competitive, with Lowe's facing intense rivalry from Home Depot and other smaller players. This competition leads to high marketing and advertising expenses, as well as pressure to maintain low prices.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 171.89%
Debt Cost 4.87%
Equity Weight -71.89%
Equity Cost 9.67%
WACC 1.41%
Leverage -239.11%

11. Quality Control: Lowe's Companies, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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PulteGroup

A-Score: 5.8/10

Value: 6.0

Growth: 8.8

Quality: 7.7

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

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Booking

A-Score: 5.8/10

Value: 3.6

Growth: 8.7

Quality: 8.0

Yield: 1.0

Momentum: 5.0

Volatility: 8.3

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Lowe's

A-Score: 5.7/10

Value: 5.7

Growth: 6.7

Quality: 5.2

Yield: 4.0

Momentum: 4.0

Volatility: 9.0

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Haverty Furniture

A-Score: 5.6/10

Value: 5.8

Growth: 3.4

Quality: 4.6

Yield: 9.0

Momentum: 5.0

Volatility: 6.0

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Home Depot

A-Score: 5.4/10

Value: 2.6

Growth: 6.0

Quality: 5.5

Yield: 6.0

Momentum: 3.0

Volatility: 9.3

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Lennar

A-Score: 4.8/10

Value: 6.8

Growth: 4.3

Quality: 5.9

Yield: 3.0

Momentum: 2.5

Volatility: 6.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

231.21$

Current Price

231.21$

Potential

0.00%

Expected Cash-Flows