Goldman Sachs Maintains Buy Rating On HD, Neutral Rating On LOW

Goldman Sachs reports that, as it has noted, “the link between housing turns and DIY sales has broken, a point supported by reported 4Q SSS trends for The Home Depot, Inc. HD/ Lowe's Companies Inc. LOW, which outpaced what foreclosure-adjusted sales suggested.” “We remain Buy-rated on HD and Neutral on LOW,” Goldman Sach writes. “While the firms offer similar risk/reward profiles, we favor HD based on market share momentum, which when combined with higher financial returns, deserves a valuation premium. “That said, LOW's new 5% off program for its private label credit card is aimed at grabbing market share after apparent share loss to HD in recent quarters. We are also introducing a 2013 EPS estimate of $2.35 for LOW with this report.” Lowe's closed Monday at $26.34; Home Depot closed at $37.56.