Barclays Maintains an 'Equalweight' on Lowe's (LOW); Q2 Preview

August 15, 2012 1:47 PM EDT Send to a Friend
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Barclays maintains an 'Equalweight' on Lowe's (NYSE: LOW) price target of $30.00.

Analyst, Alan M. Rifkin, said, "Our 2Q EPS estimate of $0.74 is based on 0-1% comps: Recall, in July, we lowered our 2Q EPS and comp estimates due to our belief that weather-driven pull-forward from 2Q to 1Q is likely to be more pronounced than we previously anticipated. Additionally, we believe that the company's move to implement its EDLP (every day low price) strategy is likely to be more of a drag to gross margins in 2Q than our earlier expectations."

Rifkin looks for same-store sales of 0-1% vs. (0.3%) compare from last year. He sees operating margins falling by 32bps to 10.08%.

Overall, he said Lowe's is on the right track, but Barclays prefers Home Depot (NYSE: HD) and rates it at Oveweight.

For an analyst ratings summary and ratings history on Lowe's click here. For more ratings news on Lowe's click here.

Shares of Lowe's closed at $26.54 yesterday.


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