Trade-Ideas: Lowe's Companies (LOW) Is Today's New Lifetime High Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Lowe's Companies ( LOW) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Lowe's Companies as such a stock due to the following factors:

  • LOW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $359.6 million.
  • LOW has traded 1.8 million shares today.
  • LOW is trading at a new lifetime high.

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More details on LOW:

Lowe's Companies, Inc. operates as a home improvement retailer. It offers products for maintenance, repair, remodeling, and home decorating. The stock currently has a dividend yield of 1.6%. LOW has a PE ratio of 25.0. Currently there are 10 analysts that rate Lowe's Companies a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for Lowe's Companies has been 7.3 million shares per day over the past 30 days. Lowe's Companies has a market cap of $46.8 billion and is part of the services sector and retail industry. The stock has a beta of 1.08 and a short float of 1.7% with 2.43 days to cover. Shares are up 24.1% year to date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Lowe's Companies as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, solid stock price performance, notable return on equity and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • LOWE'S COMPANIES INC has improved earnings per share by 13.9% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LOWE'S COMPANIES INC increased its bottom line by earning $1.68 versus $1.42 in the prior year. This year, the market expects an improvement in earnings ($2.09 versus $1.68).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, LOWE'S COMPANIES INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 63.43% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • LOW, with its decline in revenue, underperformed when compared the industry average of 14.9%. Since the same quarter one year prior, revenues slightly dropped by 0.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Specialty Retail industry average. The net income increased by 2.5% when compared to the same quarter one year prior, going from $527.00 million to $540.00 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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