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Lowe's Companies, Inc. Message Board

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  • astral_tsar astral_tsar Feb 24, 2003 12:48 PM Flag

    Newbie here

    Dear Newbie: I built up a pile of reasons why HD would be better to buy than LOW (at least by comparison).

    A few knowledgeable folks responded with facts that they feel favor LOW ...
    1. Yahoo lists PEG very slightly better for LOW.
    2. The same-store sales change over 1 quarter (if you can draw any conclusions at all from 1 quarter) favors LOW.
    (Unfortunately, unlike 1&2 above, most responses were childish attempts at disinformation.)

    Anyway, here's my last attempt to get your question answered (viz, "why should I buy LOW?")

    .......................
    Re: HD v LOW: thanks
    by: astral_tsar (36/M)
    Long-Term Sentiment: Asshole
    Msg: 17368 of 17434

    Poor "i_am_a_jackass_too", clinging bravely to one quarter of same-store sales data, wailed,

    "Which numbers"

    LOL, which numbers? which numbers? These numbers. Earnings are the same, LOW is less profitable and weaker financially (e.g. credit rating one full notch lower), and LOW costs (in price + debt per share) nearly twice as much. This is all straight from Lowe's own SEC filings, not some kind of media hype. It's dead, Jim.

    HD____________LOW
    Sales.....$59 billion ..$26 billion
    Earngs....$1.56/share...$1.73/share
    Price.....$21.50/share..$35.00/share
    Debt......$0.60/share...$5.00/share
    Cash......$1.70/share...$1.80/share
    Ret on
    Equity....19%...........19%
    Profit
    Margin....6%............5%
    PE........14............20
    Div Yld...1.1%..........0.3%
    Women Cust.45%..........45%
    Customers
    who see much
    difference...?? %.........?? %

    Why has Lowe's avoided metro areas until now?? Because they didn't want cutthroat competition against an entrenched competitor, presumably. What has changed? How is Lowe's possibly going to survive head-to-head competition? Borrow even more money? More totally unmeasured BS about customer demographics? Poor market share dressed up as an advantage?

    If LOW is growing enough to justify PE of 20, then how come PE/growth is almost 40% *higher* for Lowe's than for HD? (For anyone who feels that same store sales ("SSS") is the only number investers need to know, I'll review: for a growth stock low PEG is better for purchasers, high PEG is worse.)

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