Lowe’s Pro Sales Lead The Way As DIY Slows, Analysts Say
Shares of Lowe’s Companies Inc (NYSE:LOW) were trading higher Thursday after the company reported upbeat third-quarter results on Tuesday.
The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.
Goldman Sachs On Lowe’s Companies
Analyst Kate McShane maintained a Buy rating, while raising the price target from $260 to $276.
Although Lowe’s reported better-than-expected results for the third quarter, comparable sales contracted by 1.1%, McShane said in a note. While sales continued to be pressured by weaker DIY trends with consumers dealing with elevated interest rates, some of the headwinds were offset by “a stronger Pro business, online sales, and smaller-ticket outdoor DIY projects,” she added.
Operating margin contracted by 86 basis points year-on year to 12.3%, coming in lower than consensus of 12.5%, “with the incremental storm impact having ~15bps negative impact,” the analyst stated. “For 4Q, the company noted that excluding storm related impacts, operating margin will roughly be in line with prior year outlook reflecting benefits from ongoing PPI initiatives and incremental direct costs and lower gross margin profile,” she further wrote.
Truist Securities On Lowe’s Companies
Analyst Scot Ciccarelli reiterated a Buy rating, while lifting the price target from $307 to $310.
Storm-related activity boosted comps by around 100 basis points, “but was a drag on margins,” …
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