Lowe’s Stock To Rebound After A 10% Drop In 5 Days?

+11.59%
Upside
180
Market
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Trefis
LOW: Lowe's logo
LOW
Lowe's

Lowe’s (NYSE: LOW) stock, a home improvement retailer, has declined by almost 10% over the last five trading days and currently stands at around $160. The market probably reacted downward to the company’s mixed fourth-quarter results and disappointing guidance. While the retailer’s fourth-quarter adjusted earnings came in 3 cents higher than the estimates, its revenues were $100 million below the expectations. In addition, Lowe’s comparable sales for the quarter were up 2.5% year-over-year, short of the 3.5% expectation. It should be noted that the broader S&P 500 returned roughly a 2% fall over the last five days. Now, is LOW stock poised to fall further? We believe that the company’s stock is still undervalued at about 17x consensus 2021 earnings and that the stock could grow going forward. There is a strong chance of a rise in LOW’s stock over the next month (twenty-one trading days) based on our machine learning analysis of trends in the stock price over the last five years. See our analysis on Lowe’s Stock Chances of Rise for more details.

5D: LOW -10%, vs. S&P500 -2.2%; Underperformed market (1% likelihood event)

  • Lowe’s stock declined 10% over a five-day trading period ending 2/26/2021, compared to a broader market (S&P500) decline of 2.2%
  • A change of -10% or more over five trading days is a 1% likelihood event, which has occurred 18 times out of 1256 in the last five years

Relevant Articles
  1. Company Of The Day: Lowe’s
  2. What To Expect From Lowe’s Stock After Q1?
  3. Company Of The Day: Lowe’s
  4. Lowe’s Stock To Trade Higher Post Q4?
  5. These Stocks Are Likely To Offer Better Returns Over Lowe’s Stock
  6. This Stock Is Likely To Outperform Lowe’s Stock

10D: LOW -9.1%, vs. S&P500 -2.4%; Underperformed market (20% likelihood event)

  • Lowe’s stock declined 9.1% over the last ten trading days (two weeks), compared to a broader market (S&P500) decline of 2.4%
  • A change of -9.1% or more over ten trading days is a 20% likelihood event, which has occurred 250 times out of 1240 in the last five years

21D: LOW -4.7%, vs. S&P500 1.9%; Underperformed market (56% likelihood event)

  • Lowe’s stock declined 4.7% the last twenty-one trading days (one month), compared to a broader market (S&P500) rise of 1.9%
  • A change of -4.7% or more over twenty-one trading days is a 56% likelihood event, which has occurred 671 times out of 1198 in the last five years

While Lowe’s stock has moved downward post the Q4 release, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how the stock valuation for Lowe’s vs D.R. Horton shows a disconnect with their relative operational growth. You can find many such discontinuous pairs here.

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