Lowe's (LOW) Gains But Lags Market: What You Should Know

In the latest trading session, Lowe's (LOW) closed at $92.36, marking a +0.53% move from the previous day. The stock lagged the S&P 500's daily gain of 0.85%. At the same time, the Dow added 1.15%, and the tech-heavy Nasdaq gained 0.77%.

Coming into today, shares of the home improvement retailer had lost 1.43% in the past month. In that same time, the Retail-Wholesale sector lost 9.73%, while the S&P 500 lost 9.35%.

LOW will be looking to display strength as it nears its next earnings release, which is expected to be February 27, 2019. On that day, LOW is projected to report earnings of $0.80 per share, which would represent year-over-year growth of 8.11%. Our most recent consensus estimate is calling for quarterly revenue of $15.73 billion, up 1.55% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.11 per share and revenue of $71.40 billion, which would represent changes of +16.4% and +4.05%, respectively, from the prior year.

Any recent changes to analyst estimates for LOW should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.04% higher. LOW is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that LOW has a Forward P/E ratio of 17.96 right now. This represents a premium compared to its industry's average Forward P/E of 10.94.

Also, we should mention that LOW has a PEG ratio of 1.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. LOW's industry had an average PEG ratio of 1.07 as of yesterday's close.

The Building Products - Retail industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 104, putting it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Lowe's Companies, Inc. (LOW) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.