Lowe’s stock price target raised to $260 from $243 at RBC Capital

Investing.com - RBC Capital has raised its price target on Lowe’s (NYSE:LOW) to $260.00 from $243.00 while maintaining a Sector Perform rating on the home improvement retailer’s stock. The target sits close to Lowe’s current trading price of $257.14, with InvestingPro data indicating the stock is currently trading above its Fair Value.

The firm made only modest adjustments to its core business estimates following the company’s recent results and the announcement of the FBM acquisition, which RBC expects to begin impacting financials in the first quarter of 2026. With a market capitalization of $144.49B and a strong dividend track record spanning 55 consecutive years, Lowe’s maintains a solid market position.

For the third quarter, RBC now models comparable sales growth of 1.0%, up from its previous estimate of 0.5% but below Lowe’s guidance of 1.25%, along with adjusted earnings per share of $2.94, slightly higher than its prior projection of $2.92.

Looking further ahead, the investment bank forecasts comparable sales growth of 0.3% for fiscal 2025 and 2.5% for fiscal 2026, with adjusted earnings per share reaching $12.19 and $12.99 respectively.

The higher price target reflects both RBC’s revised 2026 earnings estimate and an increased valuation multiple of approximately 20x earnings, up from about 19x previously, which the firm attributes to "a more favorable rate outlook." Currently trading at a P/E ratio of 21.36x, the stock has shown strong momentum, though InvestingPro analysis suggests it may be in overbought territory. Get access to 8 more exclusive InvestingPro Tips and comprehensive valuation metrics to make more informed investment decisions.

In other recent news, Lowe’s has been the focus of several analyst updates and strategic moves. UBS raised its price target for Lowe’s to $325 from $300, maintaining a Buy rating. This change follows Lowe’s second-quarter results, which showed strong comparable sales growth, particularly in the DIY segment. Meanwhile, Morgan Stanley (NYSE:MS) increased its price target to $270 from $255, citing the company’s recent acquisition of Foundation Building Materials (NYSE:FBM) and a favorable risk/reward profile. DA Davidson also adjusted its price target to $266 from $240, highlighting Lowe’s improved comparable sales and guidance that surpassed consensus expectations. The acquisition of FBM, valued at nearly $9 billion, positions Lowe’s strategically in the building materials sector. Bernstein raised its price target to $279 from $266, maintaining an Outperform rating, and remarked on Lowe’s venture into the complex Pro market. These developments reflect a period of strategic growth and analyst optimism for Lowe’s.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.