Lowe's (LOW) AI Stock Analysis

• Market Cap: $122.58B
• Dividend Yield: 2.08%
• Average Volume (3M): 2.95M
• Price to Earnings (P/E): 17.9
• Beta (1Y): 0.83
• Revenue Growth: -3.13%
• EPS Growth: -7.21%
• Country: US
• Employees: 161,000
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Home Improvement
• EPS (TTM): 12.21
• Shares Outstanding: 559,706,540
• 10 Day Avg. Volume: 3,274,883
• 30 Day Avg. Volume: 2,954,680
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.53
• Price to Cash Flow (P/CF): 24.70
• P/FCF Ratio: 44.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $277.68
• Price Target Upside: 30.51% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 21

Lowe's score is driven by strong financial performance and strategic initiatives highlighted in the earnings call. However, high leverage and negative equity present significant risks. Technical indicators point to bearish momentum, which dampens the outlook despite a reasonable valuation.

Positive Factors

Acquisition Effects

Lowe's acquisition of Artisan Design Group will accelerate the retailer's push to increase Pro sales penetration.

Market Expansion

The acquisition of Artisan Design Group is expected to expand Lowe's total addressable market by $50 billion as it enters the new home construction space.

Negative Factors

Financial Concerns

The $1.3B purchase price equates to ~60% of Lowe's cash balance at the end of 4Q.

Margin Concerns

The acquisition of Artisan Design Group raises questions due to the lack of provided margin/accretion math and potential for gross margin dilution.

Lowe's Business Overview & Revenue Model

Company Description

Lowe's Companies, Inc. is a leading home improvement retailer operating primarily in the United States and Canada. Established in 1946, Lowe's offers a wide range of products for home improvement, maintenance, repair, and remodeling. The company's product offerings include appliances, tools, hardware, paint, lumber, lawn and garden supplies, and other related merchandise. Lowe's serves both retail consumers and professional customers such as contractors, builders, and repair professionals.

How the Company Makes Money

Lowe's generates revenue primarily through the sale of home improvement products in its vast network of retail stores and through its e-commerce platform. The company earns money by offering a diverse range of products across categories such as appliances, building materials, paint, and outdoor living. Additionally, Lowe's has developed a strong presence in the professional customer segment by providing services and products tailored to the needs of contractors and repair specialists. Revenue is further supplemented by installation and delivery services, which provide convenience to customers seeking a comprehensive home improvement solution. Partnerships with various suppliers and exclusive brand offerings also play a significant role in enhancing Lowe's product assortment and profit margins.

Lowe's Financial Statement Overview

Summary

Lowe's shows strong profitability with solid margins, but high leverage and negative equity pose financial risks. While cash flow management is efficient, revenue growth challenges necessitate strategic focus.

Income Statement

Lowe's has demonstrated consistent profitability with a strong gross profit margin and positive net profit margin. However, recent revenue growth has been sluggish, particularly for the latest year, which could indicate market challenges or saturation. EBIT and EBITDA margins remain solid, reflecting efficient operational management despite flat revenue trajectories.

Balance Sheet

The balance sheet shows high leverage, with a significant negative stockholders' equity, pointing to potential financial risk. Although the company maintains a substantial asset base, the debt-to-equity ratio suggests heavy reliance on debt financing. The equity ratio is negative, indicating financial instability.

Cash Flow

Lowe's has maintained strong free cash flow generation and a healthy operating cash flow to net income ratio, reflecting efficient cash management. However, the free cash flow growth rate is volatile, indicating potential fluctuations in capital expenditure and cash flow sustainability.

Breakdown
Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
83.67B	86.38B	97.06B	96.25B	89.60B
	Gross Profit
27.88B	28.84B	32.26B	32.06B	29.57B
	EBIT
10.47B	11.56B	10.16B	12.09B	9.65B
	EBITDA
10.88B	13.57B	12.69B	14.47B	11.24B
	Net Income Common Stockholders
6.96B	7.73B	6.44B	8.44B	5.83B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.13B	921.00M	1.73B	1.40B	5.20B
	Total Assets
43.10B	41.80B	43.71B	44.64B	46.73B
	Total Debt
6.78B	40.15B	37.99B	29.38B	26.21B
	Net Debt
5.02B	39.22B	36.65B	28.25B	21.52B
	Total Liabilities
57.33B	56.84B	57.96B	49.46B	45.30B
	Stockholders Equity
-14.23B	-15.05B	-14.25B	-4.82B	1.44B
Cash Flow		Free Cash Flow
7.70B	6.18B	6.76B	8.26B	9.26B
	Operating Cash Flow
9.63B	8.14B	8.59B	10.11B	11.05B
	Investing Cash Flow
-1.74B	-1.90B	-1.31B	-1.65B	-1.89B
	Financing Cash Flow
-7.05B	-6.67B	-7.05B	-12.02B	-5.19B

Lowe's Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 212.77
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOW, the sentiment is Negative. The current price of 212.77 is below the 20-day moving average (MA) of 224.44, below the 50-day MA of 234.12, and below the 200-day MA of 248.88, indicating a bearish trend. The MACD of -5.06 indicates Positive momentum. The RSI at 38.08 is Neutral, neither overbought nor oversold. The STOCH value of 44.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOW.

Lowe's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TJX	77 Outperform	$142.56B	29.96	61.98%	1.18%	3.95%	10.34%
EBAY	73 Outperform	$30.88B	16.81	34.29%	1.66%	2.79%	-23.30%
TSCO	73 Outperform	$26.67B	24.58	49.83%	1.77%	2.25%	1.00%
HD	72 Outperform	$352.90B	23.81	385.37%	2.55%	4.48%	-1.27%
FND	68 Neutral	$7.21B	35.26	10.04%	―	0.95%	-16.97%
LOW	66 Neutral	$122.58B	17.92	-51.07%	2.08%	-3.13%	-7.21%
Sector *	59 Neutral	$6.44B	11.30	3.27%	4.27%	2.37%	-21.19%

Lowe's Corporate Events

Lowe’s Unveils 2025 Total Home Strategy for Growth

Lowe’s has unveiled its 2025 Total Home Strategy at its Analyst and Investor Conference, focusing on growth initiatives such as driving Pro penetration, accelerating online sales, expanding home services, creating a loyalty ecosystem, and increasing space productivity. The company is also enhancing its operations with a new AI framework, launching a product marketplace, and expanding its store footprint, while providing financial updates and scenario planning for 2025, aiming for long-term growth and enhanced shareholder value.