NYSE:LOW

Stock Analysis Report

Executive Summary

Lowe's Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States, Canada, and Mexico.


Snowflake Analysis

Solid track record established dividend payer.


Similar Companies

Share Price & News

How has Lowe's Companies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LOW's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

13.9%

LOW

15.7%

US Specialty Retail

9.4%

US Market


1 Year Return

-18.0%

LOW

-20.9%

US Specialty Retail

-6.8%

US Market

Return vs Industry: LOW exceeded the US Specialty Retail industry which returned -25.2% over the past year.

Return vs Market: LOW underperformed the US Market which returned -10% over the past year.


Shareholder returns

LOWIndustryMarket
7 Day13.9%15.7%9.4%
30 Day-9.3%-13.6%-3.9%
90 Day-22.0%-26.3%-16.5%
1 Year-16.5%-18.0%-19.7%-20.9%-4.8%-6.8%
3 Year23.3%16.4%9.4%4.0%23.4%15.2%
5 Year39.4%27.4%8.8%0.1%41.3%25.7%

Price Volatility Vs. Market

How volatile is Lowe's Companies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lowe's Companies undervalued compared to its fair value and its price relative to the market?

33.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LOW ($90.96) is trading below our estimate of fair value ($140.24)

Significantly Below Fair Value: LOW is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: LOW is poor value based on its PE Ratio (16.6x) compared to the Specialty Retail industry average (7.5x).

PE vs Market: LOW is poor value based on its PE Ratio (16.6x) compared to the US market (13x).


Price to Earnings Growth Ratio

PEG Ratio: LOW is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: LOW is overvalued based on its PB Ratio (35.2x) compared to the US Specialty Retail industry average (0.8x).


Next Steps

Future Growth

How is Lowe's Companies forecast to perform in the next 1 to 3 years based on estimates from 25 analysts?

8.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LOW's forecast earnings growth (8.4% per year) is above the savings rate (1.7%).

Earnings vs Market: LOW's earnings (8.4% per year) are forecast to grow slower than the US market (13.3% per year).

High Growth Earnings: LOW's earnings are forecast to grow, but not significantly.

Revenue vs Market: LOW's revenue (2.3% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: LOW's revenue (2.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LOW's Return on Equity is forecast to be very high in 3 years time (343.9%).


Next Steps

Past Performance

How has Lowe's Companies performed over the past 5 years?

4.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LOW has high quality earnings.

Growing Profit Margin: LOW's current net profit margins (5.9%) are higher than last year (3.3%).


Past Earnings Growth Analysis

Earnings Trend: LOW's earnings have grown by 4.2% per year over the past 5 years.

Accelerating Growth: LOW's earnings growth over the past year (83.8%) exceeds its 5-year average (4.2% per year).

Earnings vs Industry: LOW earnings growth over the past year (83.8%) exceeded the Specialty Retail industry 6.7%.


Return on Equity

High ROE: Whilst LOW's Return on Equity (217.09%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Lowe's Companies's financial position?


Financial Position Analysis

Short Term Liabilities: LOW's short term assets ($15.3B) exceed its short term liabilities ($15.2B).

Long Term Liabilities: LOW's short term assets ($15.3B) do not cover its long term liabilities ($22.3B).


Debt to Equity History and Analysis

Debt Level: LOW's debt to equity ratio (944.3%) is considered high.

Reducing Debt: LOW's debt to equity ratio has increased from 114.1% to 944.3% over the past 5 years.

Debt Coverage: LOW's debt is well covered by operating cash flow (23.1%).

Interest Coverage: LOW's interest payments on its debt are well covered by EBIT (9.5x coverage).


Balance Sheet


Next Steps

Dividend

What is Lowe's Companies's current dividend yield, its reliability and sustainability?

2.33%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: LOW's dividend (2.42%) is higher than the bottom 25% of dividend payers in the US market (1.93%).

High Dividend: LOW's dividend (2.42%) is low compared to the top 25% of dividend payers in the US market (5.46%).


Stability and Growth of Payments

Stable Dividend: LOW's dividends per share have been stable in the past 10 years.

Growing Dividend: LOW's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (38.8%), LOW's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LOW's dividends in 3 years are forecast to be well covered by earnings (34% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.5yrs

Average management tenure


CEO

Marvin Ellison (54yo)

1.75s

Tenure

US$14,302,791

Compensation

Mr. Marvin R. Ellison has been a Director of FedEx Corporation since 2014. Mr. Ellison serves as the President, Chief Executive Officer and Director of Lowe’s Companies, Inc since July 2, 2018. Mr. Ellison ...


CEO Compensation Analysis

Compensation vs Market: Marvin's total compensation ($USD14.30M) is about average for companies of similar size in the US market ($USD11.79M).

Compensation vs Earnings: Insufficient data to compare Marvin's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Marvin Ellison
President1.75yrsUS$14.30m0.016% $11.1m
David Denton
Executive VPno dataUS$3.11m0.0043% $3.1m
Ross McCanless
Executive VP5.25yrsUS$2.83m0.0063% $4.5m
Jennifer Weber
Executive Vice President of Human Resources4.08yrsUS$2.84m0.0039% $2.8m
Joseph McFarland
Executive Vice President of Stores1.67yrsUS$3.74m0.0036% $2.6m
Seemantini Godbole
Executive VP & Chief Information Officer1.42yrsno data0.0033% $2.4m
Nelson Peace
Senior Vice President of Administration8.25yrsno datano data
Jeff Vining
Senior VP3.25yrsno datano data
Dan Frahm
Vice President of Corporate Communicationsno datano datano data
Marisa Thalberg
Executive VP and Chief Brand & Marketing Officer0.17yrno data0.0014% $1.0m

2.5yrs

Average Tenure

52.5yo

Average Age

Experienced Management: LOW's management team is considered experienced (2.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Marvin Ellison
President1.75yrsUS$14.30m0.016% $11.1m
Brian Rogers
Independent Director1.83yrsUS$249.58k0.0013% $940.2k
Richard Dreiling
Independent Chairman1.75yrsUS$456.66kno data
Sandra Cochran
Independent Director4.25yrsUS$272.08k0.00020% $142.5k
James Morgan
Independent Director5.25yrsUS$272.08kno data
Eric Wiseman
Independent Director8.42yrsUS$292.08kno data
Bertram Scott
Independent Director4.42yrsUS$272.08kno data
Ralph Alvarez
Independent Director9.67yrsUS$297.08kno data
Laurie Douglas
Independent Director4.92yrsUS$272.08kno data
Angela Rose Braly
Independent Director6.42yrsUS$287.08kno data

4.7yrs

Average Tenure

63.5yo

Average Age

Experienced Board: LOW's board of directors are considered experienced (4.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: LOW insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lowe's Companies, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lowe's Companies, Inc.
  • Ticker: LOW
  • Exchange: NYSE
  • Founded: 1946
  • Industry: Home Improvement Retail
  • Sector: Retail
  • Market Cap: US$71.229b
  • Shares outstanding: 754.95m
  • Website: https://www.lowes.com

Number of Employees


Location

  • Lowe's Companies, Inc.
  • 1000 Lowe’s Boulevard
  • Mooresville
  • North Carolina
  • 28117
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LOWNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1969
0JVQLSE (London Stock Exchange)YesCommon StockGBUSDJan 1969
LWEDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1969
LOW *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1969
LWEETLX (Eurotlx)YesCommon StockITEURJan 1969
LOWEWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1969
LOWC34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 0.5 COM USD0.50BRBRLMay 2019

Biography

Lowe's Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States, Canada, and Mexico. The company offers a line of products for construction, maintenance, repair, remodeling, and decorating. It provides home improvement products in various categories, such as lumber and building materials, appliances, seasonal and outdoor living, tools and hardware, fashion fixtures, rough plumbing and electrical, paint, millwork, lawn and garden, flooring, and kitchens. 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 branded products to homeowners, renters, and professional customers. As of February 1, 2019, it operated 2,015 home improvement and hardware stores. The company also sells its products through online sites comprising Lowes.com and Lowesforpros.com; and through mobile applications. Lowe's Companies, Inc. was founded in 1946 and is based in Mooresville, North Carolina. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/09 04:39
End of Day Share Price2020/04/08 00:00
Earnings2020/01/31
Annual Earnings2020/01/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.