Oppenheimer Reiterates Outperform, $34 PT on Lowe's

Oppenheimer remains rated Outperform with a $34 target price on Lowe's LOW as a quick read on Q4 results points to the company heading in the right direction. Oppenheimer says, "We view the better-than-expected Q4 (Jan.) results and solid FY12 (Jan. 2013) guidance that LOW reported today as further evidence that the company continues to successfully reposition its chain while it capitalizes upon improving demand dynamics with the Home Sector. Comp sales rose an above-plan +3.4%. Weather clearly helped. Data also suggest that housing-related headwinds are easing at an accelerating pace. We are optimistic that weaker gross margins at LOW lately reflect management more aggressively taking markdowns and shifting to an EDLP strategy. These efforts should pave the way for better gross margins in coming quarters." LOW closed at $27.16 a share on Friday.