Why NYSE:LOW provides a good dividend, while having solid fundamentals.

Take a closer look at LOWE'S COS INC (NYSE:LOW), a stock of interest to dividend investors uncovered by our stock screener. NYSE:LOW excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

A Closer Look at Dividend for NYSE:LOW

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NYSE:LOW was assigned a score of 7 for dividend:

• LOW's Dividend Yield is rather good when compared to the industry average which is at 3.35. LOW pays more dividend than 83.06% of the companies in the same industry.
• On average, the dividend of LOW grows each year by 19.28%, which is quite nice.
• 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.
• LOW pays out 35.14% of its income as dividend. This is a sustainable payout ratio.

Unpacking NYSE:LOW's Health Rating

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:LOW was assigned a score of 5 for health:

• An Altman-Z score of 3.51 indicates that LOW is not in any danger for bankruptcy at the moment.
• LOW's Altman-Z score of 3.51 is fine compared to the rest of the industry. LOW outperforms 74.19% of its industry peers.
• With a decent Debt to FCF ratio value of 4.31, LOW is doing good in the industry, outperforming 60.48% of the companies in the same industry.

Profitability Analysis for NYSE:LOW

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:LOW was assigned a score of 8 for profitability:

• LOW's Return On Assets of 15.88% is amongst the best of the industry. LOW outperforms 93.55% of its industry peers.
• With an excellent Return On Invested Capital value of 31.08%, LOW belongs to the best of the industry, outperforming 97.58% of the companies in the same industry.
• LOW had an Average Return On Invested Capital over the past 3 years of 32.86%. This is significantly above the industry average of 13.96%.
• With an excellent Profit Margin value of 8.44%, LOW belongs to the best of the industry, outperforming 86.29% of the companies in the same industry.
• LOW's Profit Margin has improved in the last couple of years.
• Looking at the Operating Margin, with a value of 12.79%, LOW belongs to the top of the industry, outperforming 90.32% of the companies in the same industry.
• LOW's Operating Margin has improved in the last couple of years.

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Check the latest full fundamental report of LOW for a complete fundamental analysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.