Lowe's Companies Inc. (LOW): Today's Featured Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Lowe's Companies ( LOW) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day down 1.5%. By the end of trading, Lowe's Companies fell 77 cents (-1.9%) to $38.64 on average volume. Throughout the day, 8.2 million shares of Lowe's Companies exchanged hands as compared to its average daily volume of 10.2 million shares. The stock ranged in price between $38.63-$39.62 after having opened the day at $39.41 as compared to the previous trading day's close of $39.41. Other companies within the Services sector that declined today were: Millennial Media ( MM), down 37.5%, Office Depot ( ODP), down 16.7%, Town Sports International Holdings ( CLUB), down 13.1%, and Orchard Supply Hardware ( OSH), down 12.3%.
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Lowe's Companies, Inc., together with its subsidiaries, operates as a home improvement retailer. It offers a range of products for maintenance, repair, remodeling, and home decorating. Lowe's Companies has a market cap of $44.02 billion and is part of the retail industry. The company has a P/E ratio of 23.3, above the S&P 500 P/E ratio of 17.7. Shares are up 10.2% year to date as of the close of trading on Tuesday. Currently there are 11 analysts that rate Lowe's Companies a buy, one analyst rates it a sell, and nine rate it a hold.

TheStreet Ratings rates Lowe's Companies as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, notable return on equity, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

On the positive front, NetSpend Holdings ( NTSP), up 28.6%, China Yida ( CNYD), up 11.1%, CIBT Education Group ( MBA), up 9.7%, and PokerTek ( PTEK), up 9.5%, were all gainers within the services sector with J.C. Penney ( JCP) being today's featured services sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the services sector could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the services sector could consider ProShares Ultra Short Consumer Sers ( SCC).

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