Lowe's Stock Pops On Earnings; Creating A Selling Opportunity

Nov. 17, 2022 12:46 PM ETLowe's Companies, Inc. (LOW)36 Comments

Summary

  • Lowe's is a great business, and the stock appears cheap on the surface, but there are big hidden risks over the medium-term.
  • Pandemic stimulus and low interest rates created an unsustainable boom in earnings.
  • It's highly likely earnings growth declines significantly over the next two years.
  • I do much more than just articles at The Cyclical Investor’s Club: Members get access to model portfolios, regular updates, a chat room, and more. Learn More »

Lowe"s store in Toronto, Canada.

JHVEPhoto

Introduction

I last wrote about Lowe's stock (NYSE:LOW) on April 18th, 2022, when I warned investors "Lowe's Is Probably The Biggest Value Trap In The S&P 500". And that it would be wise to sell

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Lowe's Historical Earnings

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Lowe's Stock EPS Trend

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Lowe's Stock During the 2008 recession

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Lowe's Earnings Trends

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This article was written by

Cory Cramer profile picture
20.2K Followers
One-of-kind research using historical cycles to identify tops and bottoms

My analysis focuses on the cyclical nature of individual companies and of markets in general. I've developed a unique approach to estimating the fair value of cyclical stocks, and that approach allows me to more accurately buy near the bottom of the cycle.

My academic background is in political science and I hold a Bachelor's Degree and a Master's Degree in political theory from Iowa State University. I was awarded a Graduate Research Excellence Award in 2015 for my research on conservatism.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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