LOWE'S COS INC (LOW) Stock Fundamental Analysis
USA - NYSE:LOW - US5486611073 - Common Stock
247.99 USD
-3.32 (-1.32%)
246.73 USD
-1.26 (-0.51%)
Taking everything into account, LOW scores 5 out of 10 in our fundamental rating. LOW was compared to 122 industry peers in the Specialty Retail industry. LOW has an excellent profitability rating, but there are some minor concerns on its financial health. LOW is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
LOW had positive earnings in the past year.
In the past year LOW had a positive cash flow from operations.
LOW had positive earnings in each of the past 5 years.
In the past 5 years LOW always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of LOW (14.68%) is better than 90.16% of its industry peers.
With an excellent Return On Invested Capital value of 31.40%, LOW belongs to the best of the industry, outperforming 96.72% of the companies in the same industry.
LOW had an Average Return On Invested Capital over the past 3 years of 32.39%. This is significantly above the industry average of 11.93%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.68% | ||
| ROE | N/A | ||
| ROIC | 31.4% |
ROA(3y)16.41%
ROA(5y)16.1%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)32.39%
ROIC(5y)32.79%
1.3 Margins
The Profit Margin of LOW (8.18%) is better than 84.43% of its industry peers.
LOW's Profit Margin has improved in the last couple of years.
LOW's Operating Margin of 12.35% is amongst the best of the industry. LOW outperforms 87.70% of its industry peers.
In the last couple of years the Operating Margin of LOW has grown nicely.
LOW has a Gross Margin of 33.46%. This is comparable to the rest of the industry: LOW outperforms 42.62% of its industry peers.
LOW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.35% | ||
| PM (TTM) | 8.18% | ||
| GM | 33.46% |
OM growth 3Y-0.59%
OM growth 5Y7.17%
PM growth 3Y-1.72%
PM growth 5Y6.99%
GM growth 3Y0.01%
GM growth 5Y0.94%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LOW is creating value.
Compared to 1 year ago, LOW has less shares outstanding
LOW has less shares outstanding than it did 5 years ago.
The debt/assets ratio for LOW has been reduced compared to a year ago.
2.2 Solvency
LOW has an Altman-Z score of 3.65. This indicates that LOW is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.65, LOW is doing good in the industry, outperforming 79.51% of the companies in the same industry.
LOW has a debt to FCF ratio of 4.52. This is a neutral value as LOW would need 4.52 years to pay back of all of its debts.
The Debt to FCF ratio of LOW (4.52) is better than 65.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 4.52 | ||
| Altman-Z | 3.65 |
ROIC/WACC3.37
WACC9.33%
2.3 Liquidity
LOW has a Current Ratio of 1.05. This is a normal value and indicates that LOW is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.05, LOW is not doing good in the industry: 71.31% of the companies in the same industry are doing better.
LOW has a Quick Ratio of 1.05. This is a bad value and indicates that LOW is not financially healthy enough and could expect problems in meeting its short term obligations.
LOW's Quick ratio of 0.29 is on the low side compared to the rest of the industry. LOW is outperformed by 78.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.05 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.67% over the past year.
LOW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.93% yearly.
The Revenue has decreased by -0.49% in the past year.
Measured over the past years, LOW shows a small growth in Revenue. The Revenue has been growing by 3.01% on average per year.
EPS 1Y (TTM)0.67%
EPS 3Y0.03%
EPS 5Y15.93%
EPS Q2Q%5.61%
Revenue 1Y (TTM)-0.49%
Revenue growth 3Y-4.56%
Revenue growth 5Y3.01%
Sales Q2Q%1.58%
3.2 Future
The Earnings Per Share is expected to grow by 7.45% on average over the next years.
LOW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.85% yearly.
EPS Next Y3.85%
EPS Next 2Y6.2%
EPS Next 3Y7.22%
EPS Next 5Y7.45%
Revenue Next Year1.9%
Revenue Next 2Y3.96%
Revenue Next 3Y3.83%
Revenue Next 5Y2.85%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.55 indicates a rather expensive valuation of LOW.
Based on the Price/Earnings ratio, LOW is valued a bit cheaper than the industry average as 72.13% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.79. LOW is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 18.35, LOW is valued on the expensive side.
LOW's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. LOW is cheaper than 63.93% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.21. LOW is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.55 | ||
| Fwd PE | 18.35 |
4.2 Price Multiples
LOW's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, LOW is valued a bit cheaper than the industry average as 77.05% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.09 | ||
| EV/EBITDA | 13.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates LOW does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of LOW may justify a higher PE ratio.
PEG (NY)5.34
PEG (5Y)1.29
EPS Next 2Y6.2%
EPS Next 3Y7.22%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.88%, LOW has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 5.56, LOW pays a better dividend. On top of this LOW pays more dividend than 80.33% of the companies listed in the same industry.
LOW's Dividend Yield is slightly below the S&P500 average, which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.88% |
5.2 History
The dividend of LOW is nicely growing with an annual growth rate of 16.94%!
LOW has paid a dividend for at least 10 years, which is a reliable track record.
LOW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)16.94%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
LOW pays out 37.92% of its income as dividend. This is a sustainable payout ratio.
LOW's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP37.92%
EPS Next 2Y6.2%
EPS Next 3Y7.22%
247.99
-3.32 (-1.32%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners79.12%
Inst Owner Change-0.67%
Ins Owners0.09%
Ins Owner Change2.05%
Market Cap139.08B
Analysts75.38
Price Target287.08 (15.76%)
Short Float %1.69%
Short Ratio3.26
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.88% |
Yearly Dividend4.53
Dividend Growth(5Y)16.94%
DP37.92%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)0.76%
Min EPS beat(2)0.49%
Max EPS beat(2)1.03%
EPS beat(4)4
Avg EPS beat(4)1.69%
Min EPS beat(4)0.49%
Max EPS beat(4)3.78%
EPS beat(8)7
Avg EPS beat(8)2.06%
EPS beat(12)11
Avg EPS beat(12)2.43%
EPS beat(16)15
Avg EPS beat(16)3.48%
Revenue beat(2)0
Avg Revenue beat(2)-1.01%
Min Revenue beat(2)-1.02%
Max Revenue beat(2)-1.01%
Revenue beat(4)2
Avg Revenue beat(4)-0.39%
Min Revenue beat(4)-1.02%
Max Revenue beat(4)0.35%
Revenue beat(8)3
Avg Revenue beat(8)-0.86%
Revenue beat(12)5
Avg Revenue beat(12)-0.59%
Revenue beat(16)7
Avg Revenue beat(16)-0.49%
PT rev (1m)2.89%
PT rev (3m)6.79%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-1.45%
EPS NY rev (1m)0.2%
EPS NY rev (3m)0.43%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)1.86%
Revenue NY rev (1m)0.19%
Revenue NY rev (3m)0.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.55 | ||
| Fwd PE | 18.35 | ||
| P/S | 1.66 | ||
| P/FCF | 18.09 | ||
| P/OCF | 14.16 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.76 |
EPS(TTM)12.07
EY4.87%
EPS(NY)13.51
Fwd EY5.45%
FCF(TTM)13.71
FCFY5.53%
OCF(TTM)17.51
OCFY7.06%
SpS149.09
BVpS-20.33
TBVpS-23.3
PEG (NY)5.34
PEG (5Y)1.29
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.68% | ||
| ROE | N/A | ||
| ROCE | 41.33% | ||
| ROIC | 31.4% | ||
| ROICexc | 39.76% | ||
| ROICexgc | 43.43% | ||
| OM | 12.35% | ||
| PM (TTM) | 8.18% | ||
| GM | 33.46% | ||
| FCFM | 9.19% |
ROA(3y)16.41%
ROA(5y)16.1%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)32.39%
ROIC(5y)32.79%
ROICexc(3y)34.76%
ROICexc(5y)35.76%
ROICexgc(3y)35.07%
ROICexgc(5y)36.32%
ROCE(3y)42.91%
ROCE(5y)43.33%
ROICexcg growth 3Y-4.01%
ROICexcg growth 5Y13.22%
ROICexc growth 3Y-2.86%
ROICexc growth 5Y13.49%
OM growth 3Y-0.59%
OM growth 5Y7.17%
PM growth 3Y-1.72%
PM growth 5Y6.99%
GM growth 3Y0.01%
GM growth 5Y0.94%
F-Score6
Asset Turnover1.79
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 4.52 | ||
| Debt/EBITDA | 2.47 | ||
| Cap/Depr | 105.18% | ||
| Cap/Sales | 2.55% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.48% | ||
| Profit Quality | 112.38% | ||
| Current Ratio | 1.05 | ||
| Quick Ratio | 0.29 | ||
| Altman-Z | 3.65 |
F-Score6
WACC9.33%
ROIC/WACC3.37
Cap/Depr(3y)97.39%
Cap/Depr(5y)100.6%
Cap/Sales(3y)2.15%
Cap/Sales(5y)2.08%
Profit Quality(3y)98.81%
Profit Quality(5y)110.8%
High Growth Momentum
Growth
EPS 1Y (TTM)0.67%
EPS 3Y0.03%
EPS 5Y15.93%
EPS Q2Q%5.61%
EPS Next Y3.85%
EPS Next 2Y6.2%
EPS Next 3Y7.22%
EPS Next 5Y7.45%
Revenue 1Y (TTM)-0.49%
Revenue growth 3Y-4.56%
Revenue growth 5Y3.01%
Sales Q2Q%1.58%
Revenue Next Year1.9%
Revenue Next 2Y3.96%
Revenue Next 3Y3.83%
Revenue Next 5Y2.85%
EBIT growth 1Y-0.73%
EBIT growth 3Y-5.12%
EBIT growth 5Y10.39%
EBIT Next Year19.7%
EBIT Next 3Y10.72%
EBIT Next 5Y7.42%
FCF growth 1Y15.82%
FCF growth 3Y-2.32%
FCF growth 5Y22.21%
OCF growth 1Y14.92%
OCF growth 3Y-1.64%
OCF growth 5Y17.44%