Lowe’s Companies (LOW) vs. Its Rivals Critical Survey

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

Profitability

This table compares Lowe’s Companies and its peers’ 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%

Insider & Institutional Ownership

74.1% of Lowe’s Companies shares are owned by institutional investors. Comparatively, 67.1% of shares of all “RETAIL – HOME FRN” companies are owned by institutional investors. 0.3% of Lowe’s Companies shares are owned by insiders. Comparatively, 5.0% of shares of all “RETAIL – HOME FRN” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Lowe’s Companies pays an annual dividend of $4.60 per share and has a dividend yield of 2.1%. 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 2.5% and pay out 49.0% of their earnings in the form of a dividend. Lowe’s Companies has increased its dividend for 53 consecutive years.

Valuation & Earnings

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

	Gross Revenue	Net Income	Price/Earnings Ratio
Lowe’s Companies	$83.67 billion	$6.96 billion	18.16
Lowe’s Companies Competitors	$26.26 billion	$2.36 billion	16.75

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

Analyst Ratings

This is a breakdown of recent ratings for Lowe’s Companies and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lowe’s Companies	1	9	16	0	2.58
Lowe’s Companies Competitors	173	1319	2030	38	2.54

Lowe’s Companies currently has a consensus target price of $271.12, suggesting a potential upside of 23.72%. As a group, “RETAIL – HOME FRN” companies have a potential upside of 17.95%. Given Lowe’s Companies’ stronger consensus rating and higher possible upside, analysts plainly believe Lowe’s Companies is more favorable than its peers.

Risk and Volatility

Lowe’s Companies has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500. Comparatively, Lowe’s Companies’ peers have a beta of 1.46, suggesting that their average share price is 46% more volatile than the S&P 500.

Summary

Lowe’s Companies beats its peers 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.