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Analysts Have a ‘Buy’ Rating for Lowe’s before Q2 2018 Earnings

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Aug. 20 2018, Updated 9:01 a.m. ET

Analysts’ ratings

Of the 32 analysts covering Lowe’s Companies (LOW), 78.1% are recommending a “buy,” and the remaining 21.9% are recommending a “sell” as of August 16. None of the analysts are recommending a “sell.” Analysts have an average price target of $108.79, which represents a return potential of 11.4% from its current stock price of $97.68.

Since the announcement of Lowe’s first-quarter earnings, Wedbush, Citigroup, and RBC have all raised their price targets. Wedbush raised it from $85 to $92, Citigroup raised it from $94 to $99, and RBC raised it from $101 to $104. The investments that management has made to enhance customer experience and Bill Ackman’s Pershing Square Capital’s acquisition of a stake in the company appear to have compelled analysts to raise their price targets.

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Lowe’s stock price moves in tandem with analysts’ ratings. When analysts raise their price targets, the stock tends to rise, and vice versa. Currently, Lowe’s is trading below analysts’ average price target. However, that doesn’t mean an automatic “buy.” Investors are advised to analyze analysts’ expectations discussed in the previous parts of this series before making any investment decisions.

Peer comparisons

The price targets and return potentials of Lowe’s peers are as follows:

  • Home Depot (HD): target price of $214.43 with a return potential of 9.8%
  • Williams-Sonoma (WSM): target price of $55.47, which represents a fall of 4.3% from its current stock price of $57.94
  • Bed Bath & Beyond (BBBY): target price of $17.75, which represents a fall of 2.9% from its current stock price of $18.28
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