Lowe’s Stock Price Signals a Buying Opportunity After Q3 Release

Key Points

• Lowe's outperformed its competitors and is well-positioned for a strong 2026.
• Cash flow sustains a healthy capital return, including dividends and buybacks.
• Analysts and institutional activity point to a robust rebound and potential for new highs in 2026.

Lowe’s NYSE: LOW reported mixed results and tepid guidance, but it was enough to spark a price rebound and signal a buying opportunity for investors.

While tepid, the results and outlook affirm analysts’ expectations, along with the company’s cash flow and capital returns, which are driving its stock price.

The takeaway is that headwinds persist, but this retail company is sustaining growth, maintaining margins, and building value for investors.

As a result, its stock price is likely to revert to the high end of the existing trading range and potentially set new highs in early to mid-2026. 

Lowe’s Takes Share in Q3, Outperforms Competitor

Lowe’s had a decent quarter in Q3 despite macroeconomic headwinds and the impact of 2025’s less damaging hurricane season. The company reported $20.81 billion in revenue, up 3.2%, outpacing competitor Home Depot by approximately 45 basis points but falling slightly short of the consensus.

The growth was underpinned by a 0.4% comparable sales (comps) increase, which was also better than Home Depot's, as well as by strength in the services and professional businesses. Services grew by double digits, while professional business is expected to accelerate from Q3’s solid levels due to acquisitions. 

The margin news is mixed but favorable to shareholders. The company widened its gross margin but offset the gain with increased costs.

However, the net result is better than expected, with the $3.06 in adjusted earnings up 5.6% compared to the 3.2% revenue growth and 11 cents better than MarketBeat’s reported consensus.

The critical detail is that cash flow was sufficient to sustain balance sheet and capital returns in the face of its recent acquisition, setting the business up for strength in 2026. 

Guidance was also mixed but favorable to investors. Although guidance fell short of the consensus, the increases reflect management’s improved confidence and align with the analysts' forecasts, easing market concerns for capital return payments.

As of mid-November, the company’s dividend yield stands at an attractive 2.75% annually, complemented by share buybacks that further boost returns.

The company did not buy back any shares in Q3, choosing instead to focus cash flow on its acquisition, but reduced the count by more than 1.0% YTD and is expected to resume repurchases in upcoming quarters. 

Analysts Forecast Robust Rebound for Lowe’s Stock

Analysts' trends are also mixed, reflecting a cautious outlook; however, they remain bullish on this stock. The recent string of price target reductions aligns with the broader consensus, which forecasts a 20% upside from the critical support level, and sentiment is pegged at Moderate Buy.

The Moderate Buy rating has been in place for over a year and shows no signs of faltering. The few updates issued immediately after the release suggest that the mixed trend will continue, but no change to the overall outlook is expected.

Analysts at CFRA were quick to point out the strategic value of recent acquisitions and improved exposure to professional business. 

Institutional trends suggest that this group is buying the November price dip. Although activity has declined sequentially throughout the year, the balance is bullish in every quarter, including the first half of Q4.

The Q4-to-date activity is noteworthy because it is poised to accelerate and may gain momentum now that results have been released. 

Lowe’s Stock Confirms Support at a Critical Level

Lowe’s stock surged about 5% following the Q3 release, rebounding sharply from lows set the day prior. The move confirms support at a critical level and indicates a high probability for continued rebound. LOW stock could continue to rise in this scenario, potentially reaching and retesting record levels in early 2026.