Lowe's Companies operates as a home improvement retailer, offering products for maintenance, repair, remodeling, and home decorating. The company was founded in 1946 and is based in Mooresville, North Carolina.
LOW Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for LOW, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Lowes Companies Inc ranked in the 22th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 56%. In terms of the factors that were most noteworthy in this DCF analysis for LOW, they are:
Lowes Companies Inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 20.67% of tickers in our DCF set.
LOW's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than only 20.67% of tickers in our DCF set.
Relative to other stocks in its sector (Consumer Cyclical), Lowes Companies Inc has a reliance on debt greater than just 23.68% of them.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
HGV, ETM, SBUX, SON, and HOFT can be thought of as valuation peers to LOW, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.