Lowe's Companies, Inc. LOW
Lowe's FY2025 revenue recovered to $86.3B with gross margin expanding sharply to 33.5%, but operating margin compressed further to 11.8% and EPS declined for a second straight year to $11.85 from $13.20 in FY2023 — the top-line rebound is not translating into operating leverage. Q2 2026 results confirmed persistent DIY weakness and management narrowed full-year guidance to the low end, while the stock at $208.05 trades 12% below its 200-day MA of $236.95 with a bearish MACD histogram of -1.23 and RSI at 41.
The 26% P/E discount to peers (17.6x vs 23.8x median) and $7.65B in FY2025 free cash flow provide a valuation floor, but smart money at -0.056 as of Q2 2026, $44.7B in total debt against negative equity of -$9.9B, and net insider selling of $22.5M over 24 months suggest conviction is fading alongside the earnings erosion — wait for evidence of margin stabilization before turning constructive.
What could go wrong
- Housing market deep freeze. Persistent weakness in existing home sales and DIY discretionary spending could prolong the revenue and EPS decline; management already flagged soft DIY demand in Q2 2026.
- Leverage and negative equity. Total debt of $44.7B against negative stockholders' equity of -$9.9B limits financial flexibility and raises dividend-sustainability questions as flagged in recent news coverage.
- Operating margin compression. Operating margin has contracted from 13.4% in FY2023 to 11.8% in FY2025 despite gross margin expansion to 33.5%, signaling SG&A or cost-pressure issues that could persist.
- Institutional sentiment deterioration. Smart money score declined from +0.136 in Q3 2025 to -0.056 as of Q2 2026, and insiders were net sellers of $22.5M over the trailing 24 months.
What would change my mind
Where this comes from: FMP FY2025 (period ended 2026-01-30) · derived_metrics FY2025 · FMP FY2023–FY2025 · peer_relative. Orin's read on LOW; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All LOW filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Fmr | $8.2B | 0.4% of fund |
| Vanguard Capital Management | $8.1B | 0.2% of fund |
| Jpmorgan Chase & | $8.0B | 0.4% of fund |
| State Street | $5.6B | 0.2% of fund |
| Vanguard Portfolio Management | $3.2B | 0.1% of fund |
| Geode Capital Management | $3.1B | 0.2% of fund |
133 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 167 Form 4 filings, net −$22.7M. Of the 50 on hand, 0 were open-market purchases and 3 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about LOW
Orin answers questions about LOW from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 16.2× | 20.3× | 79.6× |
| EV/EBITDA | 12.0× | 13.4× | — |
| P/S | 1.19× | 1.72× | — |
Its P/E sits 20th percentile of its own last 5 years (−1.73σ from its own mean).
2.9%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $7.7B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$256
$232 – $276 · +34% against today's price
- 31 buy or overweight
- 19 hold
- 1 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| LOWLowe's Companies, Inc. | $107B | 16.2× | 12.0× | 33.1% | 7.3% | -72% |
| BKNGBooking Holdings Inc. | $121B | 17.2× | 11.5× | 100.0% | 25.5% | -97% |
| NKENIKE, Inc. | $53B | 17.2× | 12.1× | 42.9% | 6.7% | 22% |
| ORLYO'Reilly Automotive, Inc. | $71B | 27.1× | 19.9× | 51.6% | 14.3% | -232% |
| RCLRoyal Caribbean Cruises Ltd. | $62B | 14.2× | 11.7× | 46.6% | 23.6% | 44% |
| SBUXStarbucks Corporation | $107B | 54.1× | 21.5× | 31.7% | 5.2% | -24% |
| TJXThe TJX Companies, Inc. | $145B | 24.3× | 16.9× | 32.1% | 9.7% | 60% |
The median is of the 6 peers listed above and nothing else — check it against the column. This company trades 22.1% below it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $165 | $215.66 · −23% | 2026-06-10 |
| Levered DCF | $134 | $215.66 · −38% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.