Stifel downgrades Lowe’s to Sell, stays cautious on Home Depot ahead of earnings Sam Boughedda Fri, November 13, 2026 at 9:21 AM EST 2 min read HD -0.98% LOW -1.11% ^GSPC -0.06% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Investing.com -- Stifel has downgraded Lowe's (NYSE:LOW) to Sell from Hold ahead of the home improvement retailer's fiscal third-quarter results next week, with the firm also taking a cautious stance on Home Depot (NYSE:HD).
Our AI stock portfolio is beating the S&P 500 by 118%. Discover the stocks we're buying and the opportunities we're watching next. Exclusive for Yahoo! Finance readers: 55% off for Black Friday, plus an extra 15% at checkout. Subscribe today! »
Analyst W. Andrew Carter noted that since Oct. 7, Home Depot and Lowe's shares have jumped 25.3% and 21.9%, respectively, while the S&P 500 fell 2.7%, as investors rotated into the stocks. Both now trade at the 96th percentile of their five-year valuation range relative to the S&P 500.
"We believe these levels require certainty not currently offered by the home centers," Carter wrote.
Stifel flagged three challenges, including a weaker second-half 2026 backdrop, pressure on operating margins in fiscal 2027 and 2028, and structural issues such as weakness among do-it-yourself customers, housing uncertainty, and rising competition.
Stop chasing stocks after they've already rallied. Find your next investment opportunity with AI stock picks, earnings insights, and market-moving news. Yahoo! Finance readers get an extra 15% off on top of the 55% off Black Friday price. Join today! »
The firm's checks show identical products selling at an average 3.05% discount at Amazon, Costco and Walmart compared with the home improvement chains.
Stifel forecasts fiscal 2026 adjusted EPS of $14.95 for Home Depot and $12.14 for Lowe's, slightly below consensus. Its fiscal 2028 estimates are 7% and 8% below consensus, respectively.
Carter said Home Depot is better positioned, with a stronger platform serving professional contractors. Lowe's, by contrast, has nearly 60% of its specialty trade business exposed to new home construction, which has weakened.
"Conversely, we believe LOW is overexposed to the challenges requiring investments above investor expectations and large-scale M&A to bolster LOW's subscale specialty trade platform which would likely require equity given LOW's balance sheet," he said.
Stifel expects pressure on Lowe's shares as these challenges are digested, starting with its results and next month's investor day.
Stifel downgrades Lowe's to Sell, stays cautious on Home Depot ahead of earnings
Rezolute stock rises on positive Phase 3 upLIFT trial results
Candel Therapeutics stock plummets 35% on prostate cancer BLA delay
