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Lowe's (LOW) Stock Sinks As Market Gains: What You Should Know

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Lowe's (LOW - Free Report) closed at $112.62 in the latest trading session, marking a -0.29% move from the prior day. This change lagged the S&P 500's 0.37% gain on the day. Meanwhile, the Dow gained 0.42%, and the Nasdaq, a tech-heavy index, added 0.56%.

Heading into today, shares of the home improvement retailer had gained 4.93% over the past month, outpacing the Retail-Wholesale sector's gain of 2.79% and the S&P 500's gain of 4.42% in that time.

Investors will be hoping for strength from LOW as it approaches its next earnings release, which is expected to be November 20, 2019. On that day, LOW is projected to report earnings of $1.34 per share, which would represent year-over-year growth of 28.85%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.71 billion, up 1.71% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.67 per share and revenue of $72.53 billion. These totals would mark changes of +10.31% and +1.71%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for LOW. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.06% higher. LOW is holding a Zacks Rank of #2 (Buy) right now.

Valuation is also important, so investors should note that LOW has a Forward P/E ratio of 19.94 right now. This represents a premium compared to its industry's average Forward P/E of 14.5.

It is also worth noting that LOW currently has a PEG ratio of 1.48. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. LOW's industry had an average PEG ratio of 1.41 as of yesterday's close.

The Building Products - Retail industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 87, which puts it in the top 35% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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