The stock market continues to scream higher in 2018 and Lowe's (LOW) stock is only adding fuel to the fire.
Shares are jumping Tuesday, the first trading day of the holiday-shortened week. Up more than 4% 30 minutes into the morning trading session, shares have pared some of those gains, now up just 2.7%.
Lowe's stock is rallying after reports of activist investor D.E. Shaw building a stake in the company. However, there are more reasons to buy Lowe's than D.E. Shaw, TheStreet's Jim Cramer said on CNBC's "Squawk on the Street" show.
"There's a lot of reasons to buy Lowe's," he said. For starters, Credit Suisse analyst Seth Sigman bumped his price target on the stock to $116 from $88. Sigman reiterated his outperform rating on Lowe's stock. Despite Tuesday's jump, the reasoning from Credit Suisse to buy Lowe's remains valid, Cramer said.
Clearly investors are willing to pay a higher premium for these high-quality stocks, as the valuation has crept higher for both Lowe's and Home Depot (HD) .
After missing both earnings and revenue estimates for two consecutive quarters, Lowe's delivered an impressive result in November. After beating on earnings and revenue forecasts, Lowe's delivered comp-store sales growth of 5.1%. That comp-store sales growth handedly outpaced its results for the first two quarters of Lowe's fiscal year. Holiday estimates for retailers have been coming in strong, too.
"What a stock, what a horse, what a retailer," concluded Cramer, who also manages the Action Alerts PLUS charitable trust portfolio.
Lowe's stock slipped throughly Tuesday's session, ending the day at $100.97, up just 0.12%.
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