Renovation Blues: Lowe’s Faces Off Against Shifting Consumer Trends And Home Improvement Headwinds – Lowe’s Companies (NYSE:LOW)

  • Telsey Advisory Group analyst Joseph Feldman reiterated an Outperform rating on Lowe’s Companies, Inc. LOWlowering the price target to $225 from $235.
  • The analyst remains cautious as the company will likely bear the brunt of general weakness in consumer spending on home improvement due to pressure from a worsened macroeconomic environment, a shift in spending toward services from goods, and homeowners engaging Pros in projects smaller than before.
  • These factors were faced by Home Depot, Inc. HD during the last reported quarter, the analyst notes.
  • A sluggish start to the spring selling season from unfavorable weather and lumber price deflation is also likely to weigh on the stock.
  • Further, lackluster industry trends supporting home improvement spending have deteriorated, with declines in home sales and a slowdown in home price appreciation.
  • Feldman thinks that near-term pressures related to a softer macro and industrial backdrop should keep the stock range bound.
  • The company will hold its first quarter 2023 earnings conference call on Tuesday, May 23.
  • The analyst lowered our 1Q23 EPS estimate to $3.42 from $3.55, signaling a sales decline of 9.9% to $21.3 billion vs. $21.7 billion previously.
  • FY23 EPS estimates are lower to $13.35 vs. $13.88 previously.
  • Price Actions: LOW shares are trading higher by 3.67% to $206.53 on the last check Wednesday.

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