UBS Analyst Weighs In On Lowe's And Target's Earnings

Lowe's Companies, Inc. LOW shares opened weak for trade today as the company came out with disappointing first-quarters numbers earlier in the day.  EPS for the quarter came at $0.70 on revenue of $14.129 billion, below consensus analysts’ estimates of $0.74 and $14.227 billion.

Michael Lasser, UBS analyst, who has a Neutral rating and $84 price target on the stock was on CNBC Wednesday to weigh in on Lowe’s earnings. Lasser also discussed the better than expected same store sales number reported by Target Corporation TGT.

Market Taking Some Profits

“I think especially on the heels of what Home Depot reported yesterday, there were expectations that the comp gap between Home Depot and [Lowe’s would narrow down] today,” Lasser said. “It remained in about an average positioning, so, the market is taking some profits on that.”

Sticking to P.T. Of $84

Lasser was asked if he is sticking to his $84 price target on Lowe’s. He replied, “Without a doubt. We think that this pullback today has created an opportunity to buy a retailer that’s got great long-term positioning at a less expensive valuation because our view is that estimates are really [aren’t] going to change after today’s release.”

Target’s Comps

On Target coming up with 2.3 percent same store sales growth for the quarter, Lasser said, “It was a little slower than what they saw in the fourth-quarter. It also did sounds like trends did slow out throughout the period because they told us that the quarter had started off strong.”