There is an odd pessimism that lurks around home improvement giant Lowe’s (LOW) stock these days. Lowe’s officially completed its acquisition of Foundation Building Materials, giving it access to a range of new supplies that should make it an absolute winner for the pro builder market. But despite this, Lowe’s stock still managed to slip fractionally in Thursday morning’s trading.
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The conclusion of the acquisition gave Lowe’s access to a building materials and construction products operation that had over 370 locations throughout the United States and Canada. This means a mounting product lineup, and the ability to get product to the pro builder market faster. Throw in better digital tools for greater convenience and a solid platform from which to work and the attraction is clear.
Lowe’s now has an even better value proposition, especially in the pro builder market, a market that Lowe’s has been eager to crack open as its main rival Home Depot (HD) advances in that space as well. Lowe’s CEO, president and chairman Marvin R. Ellison noted, “Completing the acquisition of FBM is an important step in accelerating our Total Home strategy to serve large Pro customers within a $250 billion total addressable market. We would like to extend a warm welcome to the FBM team, and we look forward to building on their proven track record of profitable growth.”
It’s Apparently That Time of Year
Many of us are still getting ready for Halloween, but in many stores, thoughts—and decorations—have already turned to thoughts of Christmas. To that end, Lowe’s has already started bringing out outdoor Christmas decorations. Yes, already.
LED lighting will be front and center this year, showing up in everything from wreaths and garlands to a six-foot-tall statue of the Nutcracker. Pathway markers, light-up Merry Christmas signs, snowflake projectors—just in case we do not get much of the real thing this year—and even a set of inflatable lawn ornaments are all on tap.
Is Lowe’s a Buy, Sell or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on LOW stock based on 17 Buys and eight Holds assigned in the past three months, as indicated by the graphic below. After a 13.04% loss in its share price over the past year, the average LOW price target of $285.22 per share implies 20.84% upside potential.
