Citigroup Reiterates Neutral, $24 Target on Lowe's

Citigroup maintains it Neutral rating and $24 target price on Lowe's Companies Inc. LOW as the company keeps improving by but upside is limited by lack of business inflation. Citi says, “We were encouraged to see an improved outlook for EPS growth (+23.8% average annual growth vs. last year guidance of +20%), and EBIT (+70bps average/year, LT of 10% by 2015). … We continue to expect for the first half of the year gross margin pressure from EDLP changes and a gap in comp vs. its main competitor HD, as LOW slowly rolls out its merchandising changes. We don't expect an inflection in the business for at least another 3 to 4 quarters, which will temper any upside in the stock in our view.” LOW closed at $24.77 per share on Tuesday.