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Antony Earl
@antonyearl · May 23

Lowe's $LOW has cut its full-year sales and profit forecasts as demand for DIY goods and high inflation force consumers to curb discretionary spending.

This does not look good for the retailer in the short to medium term, as it cannot effectively raise prices and pass on inflationary pressures to customers, unlike its competitors.

At the moment, I don't mind at all, I have set my buy order at $185 (I'd already been thinking $190) and will wait for more bad news that may drive the price down gradually.

What company do you have in your sights?

YE
Yorick Ericson @yorickericson May 23

Hi, can you elaborate on "unlike its competitors, it cannot effectively raise prices and pass on inflationary pressures to customers"?

Virtually the only competitor is HD, which recently also reported results and their current search for operating margin is between 14.3% and 14.0% (10y average 14.28%) and LOW has reduced its search to 13.4% - 13.6% (10y average 8.87%, 2022 - 10.47%, 2021 - 12.56%).

The results of these companies are currently affected not only by inflation and the real estate crisis, but also by deflationary pressures on wood (the price has fallen by about 20% in the last 3 months).

I have not followed the results in detail yet, so I will be glad if you share some info.

NG
Nikolas Gabriels @nikgab May 23

I don't know about others, but I'd be quite tempted by Deutsche Post $DPW, otherwise known as DHL. I'd just like to see the price drop, at the current €42 it's not very interesting.

JB
Jason Bellier @neostonks May 23

$LLY again at $290, I wouldn't hesitate again 😄

AA
Ashraf Aboudar @ashraf_dd May 23

That's a great attitude and a chance to jump into position. It's a great company in the long run.