LOWE'S COS INC (LOW) Stock Fundamental Analysis
USA - NYSE:LOW - US5486611073 - Common Stock
265.2 USD
-2.37 (-0.89%)
268.637 USD
+3.44 (+1.3%)
LOW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 121 industry peers in the Specialty Retail industry. While LOW has a great profitability rating, there are some minor concerns on its financial health. LOW has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
LOW had positive earnings in the past year.
LOW had a positive operating cash flow in the past year.
LOW had positive earnings in each of the past 5 years.
Each year in the past 5 years LOW had a positive operating cash flow.
1.2 Ratios
LOW has a Return On Assets of 14.68%. This is amongst the best in the industry. LOW outperforms 90.08% of its industry peers.
LOW has a better Return On Invested Capital (31.40%) than 96.69% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for LOW is significantly above the industry average of 12.16%.
| 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
Looking at the Profit Margin, with a value of 8.18%, LOW belongs to the top of the industry, outperforming 84.30% of the companies in the same industry.
In the last couple of years the Profit Margin of LOW has grown nicely.
LOW has a Operating Margin of 12.35%. This is amongst the best in the industry. LOW outperforms 88.43% of its industry peers.
In the last couple of years the Operating Margin of LOW has grown nicely.
LOW has a Gross Margin (33.46%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of LOW has remained more or less at the same level.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so LOW is creating value.
Compared to 1 year ago, LOW has less shares outstanding
Compared to 5 years ago, LOW has less shares outstanding
LOW has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.74 indicates that LOW is not in any danger for bankruptcy at the moment.
The Altman-Z score of LOW (3.74) is better than 80.17% of its industry peers.
The Debt to FCF ratio of LOW is 4.52, which is a neutral value as it means it would take LOW, 4.52 years of fcf income to pay off all of its debts.
LOW has a Debt to FCF ratio of 4.52. This is in the better half of the industry: LOW outperforms 66.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 4.52 | ||
| Altman-Z | 3.74 |
ROIC/WACC3.35
WACC9.36%
2.3 Liquidity
A Current Ratio of 1.05 indicates that LOW should not have too much problems paying its short term obligations.
LOW has a worse Current ratio (1.05) than 71.90% of its industry peers.
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.
Looking at the Quick ratio, with a value of 0.29, LOW is doing worse than 77.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.05 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
LOW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.67%.
Measured over the past years, LOW shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.93% on average per year.
Looking at the last year, LOW shows a decrease in Revenue. The Revenue has decreased by -0.49% in the last 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
LOW is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.45% yearly.
LOW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.85% yearly.
EPS Next Y3.64%
EPS Next 2Y5.94%
EPS Next 3Y7.05%
EPS Next 5Y7.45%
Revenue Next Year1.9%
Revenue Next 2Y3.96%
Revenue Next 3Y3.83%
Revenue Next 5Y2.85%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 21.97, LOW is valued on the expensive side.
Based on the Price/Earnings ratio, LOW is valued a bit cheaper than the industry average as 71.07% of the companies are valued more expensively.
LOW's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.38.
With a Price/Forward Earnings ratio of 19.72, 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 62.81% of the companies in the same industry.
LOW's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.86.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.97 | ||
| Fwd PE | 19.72 |
4.2 Price Multiples
LOW's Enterprise Value to EBITDA is on the same level as the industry average.
76.86% of the companies in the same industry are more expensive than LOW, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.35 | ||
| EV/EBITDA | 14.5 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
LOW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)6.04
PEG (5Y)1.38
EPS Next 2Y5.94%
EPS Next 3Y7.05%
5. Dividend
5.1 Amount
LOW has a Yearly Dividend Yield of 1.76%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.22, LOW pays a better dividend. On top of this LOW pays more dividend than 80.99% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.38, LOW is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.76% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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 2Y5.94%
EPS Next 3Y7.05%
265.2
-2.37 (-0.89%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners78%
Inst Owner Change-0.67%
Ins Owners0.1%
Ins Owner Change2.07%
Market Cap148.73B
Analysts75.38
Price Target287.08 (8.25%)
Short Float %1.41%
Short Ratio2.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.76% |
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)6.78%
PT rev (3m)6.38%
EPS NQ rev (1m)-0.81%
EPS NQ rev (3m)-1.45%
EPS NY rev (1m)0.21%
EPS NY rev (3m)0.51%
Revenue NQ rev (1m)1.68%
Revenue NQ rev (3m)1.86%
Revenue NY rev (1m)0.74%
Revenue NY rev (3m)0.84%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.97 | ||
| Fwd PE | 19.72 | ||
| P/S | 1.78 | ||
| P/FCF | 19.35 | ||
| P/OCF | 15.15 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.5 |
EPS(TTM)12.07
EY4.55%
EPS(NY)13.45
Fwd EY5.07%
FCF(TTM)13.71
FCFY5.17%
OCF(TTM)17.51
OCFY6.6%
SpS149.09
BVpS-20.33
TBVpS-23.3
PEG (NY)6.04
PEG (5Y)1.38
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 | 3.74 |
F-Score6
WACC9.36%
ROIC/WACC3.35
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 Y3.64%
EPS Next 2Y5.94%
EPS Next 3Y7.05%
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 Year19.22%
EBIT Next 3Y10.53%
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%