UPDATE: Canaccord Genuity Downgrades Lowe's (LOW) to Sell

Canaccord Genuity downgraded Lowe's (NYSE: LOW) from Hold to Sell with a price target of $37. Analyst Laura Champine pointed to slowing housing momentum, management changes, and tough competition.

"Shares of Lowe’s have appreciated 88% since the start of 2012, compared with the S&P 500 index +52% and the RLX index +67%, and the stock is currently trading at a premium to historical multiples despite no real change to growth prospects," said Champine. "The stock clearly benefited from the flood of positive housing data over this interval. Although the housing market continues to recover, recent data suggests a deceleration in the rate of growth. We think investors will heighten their focus on underlying fundamentals as momentum slows. For Lowe’s, this includes its most challenging yr./yr. sales comparison in Q2 and our expectation for continued SSS outperformance by Home Depot."

"The merchandising and customer experience teams recently lost decades of experience. Greg Bridgeford and Bob Gfeller both recently departed after a combined 47 years at Lowe’s," added the analyst. "We are reducing our terminal growth rate from 5% to 3%. We are further along in the housing market cycle, and we view +3% as a moreachievable long-term growth rate."

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 $47.78 yesterday.

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