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Lowe\\\’s Stock Could Blast forty % Higher, According to Analyst

Lowe’s Stock Could Blast 40 % Higher, According to Analyst

A prominent Lowe’s (NYSE:LOW) bull is 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 keeping his obese (read: buy) recommendation.

The new objective is approximately forty % higher compared to Lowe’s most recent closing stock price.

Gutman made the modification of his on the notion that the present average analyst earnings projections for the business underestimate a crucial factor: demand for home improvement goods and services. The prognosticator feels it is reasonable that Lowe’s will 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 and loss]. This is not appreciated by the market,” he have written in the latest research note of his on the business.

Gutman believes the broader DIY list landscapes will typically benefit from the anticipated rise in demand. To be 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 has also raised the price target of his for Home Depot inventory, though not as dramatically. It is these days $300, from the former $295. The new level is 14 % 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 nearly 1.6 %.

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