Head to Head Review: Lowe’s Companies (LOW) and The Competition

Lowe’s Companies (NYSE:LOW) is one of 14 public companies in the “RETAIL – HOME FRN” industry, but how does it contrast to its rivals? We will compare Lowe’s Companies to related companies based on the strength of its institutional ownership, risk, analyst recommendations, dividends, valuation, profitability and earnings.

Analyst Ratings

This is a breakdown of recent recommendations for Lowe’s Companies and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lowe’s Companies	1	9	16	0	2.58
Lowe’s Companies Competitors	171	1316	2026	38	2.54

Lowe’s Companies currently has a consensus target price of $271.12, indicating a potential upside of 27.65%. As a group, “RETAIL – HOME FRN” companies have a potential upside of 23.44%. Given Lowe’s Companies’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Lowe’s Companies is more favorable than its rivals.

Profitability

This table compares Lowe’s Companies and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lowe’s Companies	8.22%	-49.12%	15.07%
Lowe’s Companies Competitors	6.52%	33.77%	8.67%

Dividends

Lowe’s Companies pays an annual dividend of $4.60 per share and has a dividend yield of 2.2%. Lowe’s Companies pays out 38.1% of its earnings in the form of a dividend. As a group, “RETAIL – HOME FRN” companies pay a dividend yield of 2.6% and pay out 49.0% of their earnings in the form of a dividend. Lowe’s Companies has raised its dividend for 53 consecutive years.

Volatility and Risk

Lowe’s Companies has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Lowe’s Companies’ rivals have a beta of 1.48, indicating that their average stock price is 48% more volatile than the S&P 500.

Valuation & Earnings

This table compares Lowe’s Companies and its rivals revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lowe’s Companies	$83.67 billion	$6.96 billion	17.60
Lowe’s Companies Competitors	$26.26 billion	$2.36 billion	16.26

Lowe’s Companies has higher revenue and earnings than its rivals. Lowe’s Companies is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

74.1% of Lowe’s Companies shares are held by institutional investors. Comparatively, 67.1% of shares of all “RETAIL – HOME FRN” companies are held by institutional investors. 0.3% of Lowe’s Companies shares are held by insiders. Comparatively, 5.2% of shares of all “RETAIL – HOME FRN” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Lowe’s Companies beats its rivals on 10 of the 15 factors compared.

Lowe’s Companies Company Profile

Lowe’s Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States. The company offers a line of products for construction, maintenance, repair, remodeling, and decorating. It also provides home improvement products, such as appliances, seasonal and outdoor living, lawn and garden, lumber, kitchens and bath, tools, paint, millwork, hardware, flooring, rough plumbing, building materials, décor, and electrical. In addition, the company offers installation services through independent contractors in various product categories; and extended protection plans and repair services. It sells its national brand-name merchandise and private brand products to professional customers, homeowners, renters, businesses, and government. The company also sells its products through Lowes.com website; and through mobile applications. Lowe’s Companies, Inc. was founded in 1921 and is based in Mooresville, North Carolina.