Lowe's Companies, Inc.

LOW

Consumer CyclicalHome ImprovementNYSE

$229.20

Market Cap: $128.37B

Lowe's Companies, Inc. (LOW) Valuation Summary

Updated May 11, 2026 21:04

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$178.52 – $516.66	$262.52	+14.5%
Growth Exit 10Y	$179.69 – $475.17	$254.43	+11.0%
EBITDA Exit 5Y	$362.65 – $598.83	$471.45	+105.7%
EBITDA Exit 10Y	$296.23 – $533.23	$398.66	+73.9%
▸ Trading Multiples
P/E	$297.83 – $492.46	$370.10	+61.5%
EV/EBITDA	$280.11 – $493.55	$410.88	+79.3%
EV/Revenue	$466.52 – $736.89	$548.78	+139.4%
▸ PEG
PEG Fair Value	$108.55 – $108.55	$108.55	-52.6%
▸ Earnings Power Value
Earnings Power Value	$140.45 – $205.97	$167.39	-27.0%
▸ Dividend Discount
Dividend Discount	$81.04 – $201.57	$119.63	-47.8%

Valuation History

DCF Analysis

Fair Value

$262.52

Market Price

$229.20

Upside / Downside

+14.5%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (75% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $262.52 per share, suggesting LOW is fairly valued by 14.5% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,364
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,523
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,136
EBITDA	12,911	14,127	14,603	15,170	15,632	16,023

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,102
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,331
(−) ΔWC	-264	931	331	410	310	318
Free Cash Flow (FCFF)	8,889	8,434	9,340	9,618	10,022	10,272

Terminal Value						172,994
WACC / Discount Rate	8.4%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	115,379

Enterprise Value	153,217
Projection Period	37,838	24.7%
Terminal Value	115,379	75.3%

(−) Current Net Debt	6,205

Equity Value	147,012
(/) Outstanding Shares	560

Fair Price	$262.52

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
6.4%	$332	$362	$401	$450	$517
7.4%	$274	$294	$318	$347	$383
8.4%	$233	$247	$263	$281	$304
9.4%	$202	$212	$223	$237	$252
10.4%	$179	$186	$194	$204	$215

Current price: $229.20. Green = undervalued, Red = overvalued.

Fair Value

$254.43

Market Price

$229.20

Upside / Downside

+11.0%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 2.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (55% of enterprise value) is derived from the Gordon Growth Model on Year 11 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $254.43 per share, suggesting LOW is fairly valued by 11.0% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,260	12,162	12,181	12,315	12,567	12,881
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,510	1,498	1,501	1,517	1,548	1,587
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,096	2,191	2,240	2,277	2,300	2,357
EBITDA	12,911	14,127	14,603	15,170	15,632	15,866	15,851	15,922	16,109	16,415	16,826

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,075	3,051	3,056	3,089	3,153	3,231
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,312	2,293	2,297	2,322	2,370	2,429
(−) ΔWC	-264	931	331	410	310	169	-84	16	115	217	222
Free Cash Flow (FCFF)	8,889	8,434	9,340	9,618	10,022	10,310	10,590	10,553	10,582	10,676	10,943

Terminal Value											184,296
WACC / Discount Rate	8.4%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	6,603	6,255	5,748	5,315	4,945	81,980

Enterprise Value	148,685
Projection Period	66,705	44.9%
Terminal Value	81,980	55.1%

(−) Current Net Debt	6,205

Equity Value	142,480
(/) Outstanding Shares	560

Fair Price	$254.43

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
6.4%	$331	$355	$385	$423	$475
7.4%	$274	$289	$306	$328	$355
8.4%	$233	$243	$254	$268	$284
9.4%	$203	$210	$218	$226	$237
10.4%	$180	$184	$190	$196	$203

Current price: $229.20. Green = undervalued, Red = overvalued.

Fair Value

$471.36

Market Price

$229.20

Upside / Downside

+105.7%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (86% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 21.7x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $471.45 per share, suggesting LOW is undervalued by 105.7% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

EV/EBITDA Exit Multiple

21.74x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,364
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,523
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,136
EBITDA	12,911	14,127	14,603	15,170	15,632	16,023

(−) Tax	2,446	2,719	2,815	2,935	3,026	—
(−) CapEx	1,839	2,044	2,116	2,206	2,275	—
(−) ΔWC	-264	931	331	410	310	—
Free Cash Flow (FCF)	8,889	8,434	9,340	9,618	10,022	—

Peers' EBITDA Multiple						21.7x
Terminal Value						348,340
WACC / Discount Rate	8.44%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	232,326

Enterprise Value	270,164
Projection Period	37,838	14.0%
Terminal Value	232,326	86.0%

(−) Current Net Debt	6,205
Equity Value	263,959
(÷) Outstanding Shares	560M
Fair Price	$471	+105.7%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	17.7x	19.7x	21.7x	23.7x	25.7x
6.4%	$431	$473	$515	$557	$599
7.4%	$413	$453	$493	$533	$573
8.4%	$395	$433	$471	$510	$548
9.4%	$378	$415	$451	$488	$524
10.4%	$363	$397	$432	$467	$502

Current price: $229.20. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$398.60

Market Price

$229.20

Upside / Downside

+73.9%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 2.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (71% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 21.7x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $398.66 per share, suggesting LOW is undervalued by 73.9% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

EV/EBITDA Exit Multiple

21.74x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,260	12,162	12,181	12,315	12,567	12,881
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,510	1,498	1,501	1,517	1,548	1,587
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,096	2,191	2,240	2,277	2,300	2,357
EBITDA	12,911	14,127	14,603	15,170	15,632	15,866	15,851	15,922	16,109	16,415	16,826

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,075	3,051	3,056	3,089	3,153	—
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,312	2,293	2,297	2,322	2,370	—
(−) ΔWC	-264	931	331	410	310	169	-84	16	115	217	—
Free Cash Flow (FCF)	8,889	8,434	9,340	9,618	10,022	10,310	10,590	10,553	10,582	10,676	—

Peers' EBITDA Multiple											21.7x
Terminal Value											365,792
WACC / Discount Rate	8.44%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	6,603	6,255	5,748	5,315	4,945	162,714

Enterprise Value	229,419
Projection Period	66,705	29.1%
Terminal Value	162,714	70.9%

(−) Current Net Debt	6,205
Equity Value	223,214
(÷) Outstanding Shares	560M
Fair Price	$399	+73.9%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	17.7x	19.7x	21.7x	23.7x	25.7x
6.4%	$404	$437	$469	$501	$533
7.4%	$373	$403	$432	$461	$491
8.4%	$345	$372	$399	$425	$452
9.4%	$320	$344	$368	$393	$417
10.4%	$296	$318	$341	$363	$385

Current price: $229.20. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$370.10

Market Price

$229.20

Upside / Downside

+61.5%

Verdict

Undervalued

Using the industry peer median P/E Multiples multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $370.10 based on 8 comparable companies in the Home Improvement industry.

P/E Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Lowe's Companies, Inc.LOW	128,352	19.3x	18.2x
The TJX Companies, Inc.TJX	170,980	31.7x	33.0x
Booking Holdings Inc.BKNG	128,576	25.1x	15.8x
Starbucks CorporationSBUX	118,825	64.0x	48.4x
MercadoLibre, Inc.MELI	82,764	41.4x	40.4x
O'Reilly Automotive, Inc.ORLY	77,780	31.3x	28.5x
Royal Caribbean Cruises Ltd.RCL	75,328	18.0x	16.2x
NIKE, Inc.NKE	65,255	20.4x	29.6x
Sea LimitedSE	54,291	35.2x	25.1x
Industry Median		31.5x	29.1x
(*) Profit after tax		6,654	7,052
Equity Value		209,453	205,056
(/) Outstanding shares		560	560
Fair Price		$374	$366

Selected Fair Value (avg of trailing + forward)

$370.10

+61.5%

Fair Value

$410.88

Market Price

$229.20

Upside / Downside

+79.3%

Verdict

Undervalued

Using the industry peer median EV/EBITDA multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $410.88 based on 8 comparable companies in the Home Improvement industry.

EV/EBITDA Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Lowe's Companies, Inc.LOW	128,352	12.6x	11.6x
The TJX Companies, Inc.TJX	170,980	21.9x	22.0x
Booking Holdings Inc.BKNG	128,576	14.2x	13.0x
Starbucks CorporationSBUX	118,825	26.4x	26.6x
MercadoLibre, Inc.MELI	82,764	25.4x	25.6x
O'Reilly Automotive, Inc.ORLY	77,780	21.6x	20.2x
Royal Caribbean Cruises Ltd.RCL	75,328	14.1x	12.9x
NIKE, Inc.NKE	65,255	15.3x	15.3x
Sea LimitedSE	54,291	27.5x	21.4x
Industry Median		21.7x	20.8x
(*) EBITDA		10,688	11,557
= Enterprise Value		232,408	240,188
(-) Net Debt		6,205	6,205
Equity Value		226,203	233,983
(/) Outstanding shares		560	560
Fair Price		$404	$418

Selected Fair Value (avg of trailing + forward)

$410.88

+79.3%

Fair Value

$548.78

Market Price

$229.20

Upside / Downside

+139.4%

Verdict

Undervalued

Using the industry peer median EV/Revenue multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $548.78 based on 8 comparable companies in the Home Improvement industry.

EV/Revenue Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Lowe's Companies, Inc.LOW	128,352	1.6x	1.4x
The TJX Companies, Inc.TJX	170,980	3.1x	3.1x
Booking Holdings Inc.BKNG	128,576	4.9x	4.4x
Starbucks CorporationSBUX	118,825	3.8x	3.8x
MercadoLibre, Inc.MELI	82,764	3.1x	3.2x
O'Reilly Automotive, Inc.ORLY	77,780	4.8x	4.5x
Royal Caribbean Cruises Ltd.RCL	75,328	5.4x	5.0x
NIKE, Inc.NKE	65,255	1.5x	1.5x
Sea LimitedSE	54,291	2.2x	1.7x
Industry Median		3.5x	3.5x
(*) Revenue		86,286	93,303
= Enterprise Value		300,120	326,928
(-) Net Debt		6,205	6,205
Equity Value		293,915	320,723
(/) Outstanding shares		560	560
Fair Price		$525	$573

Selected Fair Value (avg of trailing + forward)

$548.78

+139.4%

PEG Fair Value

Fair Value

$108.55

Market Price

$229.20

Upside / Downside

-52.6%

Verdict

Overvalued

Using the PEG framework with analyst consensus forward EPS growth of 8.6% plus 2.1% dividend yield, the company has a fair value of $108.55 based on NTM EPS (FY2027) of $12.59. The current PEG ratio is 2.11.

PEG Ratio

2.11Expensive

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 18.2 ÷ (6.6% + 2.1%) = 2.11

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Slow GrowerPEG less reliable

PEG tends to undervalue slow growers — consider dividend yield and asset value instead.

Fair Value Calculation

EPS Growth RateForward	6.6%
Dividend Yield	+2.1%
Adjusted Growth (clamped 8–25%)	8.6%
Fair P/E	8.6x
NTM EPS (FY2027)	$12.59
Fair Value	$108.55

Growth Analysis

Forward GrowthActive

Period	EPS Est.	Growth	Analysts
FY2025 (actual)	$11.85	—	—
FY2027E	$12.59	+6.3%	24
FY2028E	$13.63	+8.2%	23
FY2029E	$15.00	+10.1%	16
FY2030E	$16.46	+9.7%	8
FY2031E	$17.36	+5.4%	7

6Y Forward EPS CAGR: 6.6%

Historical Growth

Year	Net Income	EPS	YoY
FY2021	$8.4B	$12.03	—
FY2022	$6.4B	$10.17	-15.5%
FY2023	$7.7B	$13.20	+29.8%
FY2024	$7.0B	$12.23	-7.3%
FY2025	$6.7B	$11.85	-3.1%

4Y Historical EPS CAGR: -0.4%

Earnings Power Value

Fair Value

$167.39

Market Price

$229.20

Upside / Downside

-27.0%

Verdict

Overvalued

Using the Earnings Power Value framework with a WACC of 8.4% and normalized earnings of $8.4B, the company has a fair value of $167.39 per share. The EPV range is $140.45 – $205.97 based on WACC sensitivity (6.9% – 9.9%).

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	8,433	8,433	8,433
(/) WACC	9.9%	8.4%	6.9%
Enterprise Value	84,857	99,942	121,550
(-) Net debt	6,205	6,205	6,205
Equity Value	78,652	93,737	115,345
(/) Outstanding shares	560	560	560
Fair Price	$140.45	$167.39	$205.97

Dividend Discount Model

Fair Value

$119.63

Market Price

$229.20

Upside / Downside

-47.8%

Verdict

Overvalued

Using the Two-Stage Dividend Discount Model with a Cost of Equity of 8.3% and projected dividend growth of 10.9%, the fair value is $119.63 per share. The DDM range is $81.04 – $201.57 based on sensitivity analysis across Cost of Equity and growth rate assumptions.

Dividend Profile

Current DPS

$4.71

Dividend Yield

2.05%

Payout Ratio

39.6%

Dividend Coverage

2.52x

FCF Payout Ratio34.5%

DPS CAGR (4Y)13.5%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$4.71	39.6%	+4.1%
2024	$4.52	36.9%	+4.3%
2023	$4.33	32.8%	+15.4%
2022	$3.76	36.8%	+32.3%
2021	$2.84	23.5%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$5.22	10.9%	0.9236	$4.82
2027	$5.79	10.9%	0.8530	$4.94
2028	$6.42	10.9%	0.7879	$5.06
2029	$7.12	10.9%	0.7277	$5.18
2030	$7.90	10.9%	0.6721	$5.31
Terminal Value	$8.10 DPS	2.5%		$94.31

PV of Projected Dividends$25.32

PV of Terminal Value$94.31

Fair Value per Share$119.63

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	8.9%	9.9%	10.9%	11.9%	12.9%
6.3%	$170	$177	$185	$193	$202
7.3%	$134	$140	$146	$152	$158
8.3%	$110	$115	$120	$125	$130
9.3%	$93	$97	$101	$106	$110
10.3%	$81	$84	$88	$91	$95

Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.

Lowe's Companies, Inc. (LOW) Valuation Summary

Updated May 11, 2026 21:04

Model	Range	Fair Value	Upside
▸ Discounted Cash Flow
Growth Exit 5Y	$178.52 – $516.66	$262.52	+14.5%
Growth Exit 10Y	$179.69 – $475.17	$254.43	+11.0%
EBITDA Exit 5Y	$362.65 – $598.83	$471.45	+105.7%
EBITDA Exit 10Y	$296.23 – $533.23	$398.66	+73.9%
▸ Trading Multiples
P/E	$297.83 – $492.46	$370.10	+61.5%
EV/EBITDA	$280.11 – $493.55	$410.88	+79.3%
EV/Revenue	$466.52 – $736.89	$548.78	+139.4%
▸ PEG
PEG Fair Value	$108.55 – $108.55	$108.55	-52.6%
▸ Earnings Power Value
Earnings Power Value	$140.45 – $205.97	$167.39	-27.0%
▸ Dividend Discount
Dividend Discount	$81.04 – $201.57	$119.63	-47.8%

Valuation History

DCF Analysis

Fair Value

$262.52

Market Price

$229.20

Upside / Downside

+14.5%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,364
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,523
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,136
EBITDA	12,911	14,127	14,603	15,170	15,632	16,023

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,102
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,331
(−) ΔWC	-264	931	331	410	310	318
Free Cash Flow (FCFF)	8,889	8,434	9,340	9,618	10,022	10,272

Terminal Value						172,994
WACC / Discount Rate	8.4%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	115,379

Enterprise Value	153,217
Projection Period	37,838	24.7%
Terminal Value	115,379	75.3%

(−) Current Net Debt	6,205

Equity Value	147,012
(/) Outstanding Shares	560

Fair Price	$262.52

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
6.4%	$332	$362	$401	$450	$517
7.4%	$274	$294	$318	$347	$383
8.4%	$233	$247	$263	$281	$304
9.4%	$202	$212	$223	$237	$252
10.4%	$179	$186	$194	$204	$215

Current price: $229.20. Green = undervalued, Red = overvalued.

Fair Value

$254.43

Market Price

$229.20

Upside / Downside

+11.0%

Verdict

Undervalued

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

Terminal Growth

2.50%

0% – 6%

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,260	12,162	12,181	12,315	12,567	12,881
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,510	1,498	1,501	1,517	1,548	1,587
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,096	2,191	2,240	2,277	2,300	2,357
EBITDA	12,911	14,127	14,603	15,170	15,632	15,866	15,851	15,922	16,109	16,415	16,826

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,075	3,051	3,056	3,089	3,153	3,231
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,312	2,293	2,297	2,322	2,370	2,429
(−) ΔWC	-264	931	331	410	310	169	-84	16	115	217	222
Free Cash Flow (FCFF)	8,889	8,434	9,340	9,618	10,022	10,310	10,590	10,553	10,582	10,676	10,943

Terminal Value											184,296
WACC / Discount Rate	8.4%
Long-term Growth Rate	2.5%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	6,603	6,255	5,748	5,315	4,945	81,980

Enterprise Value	148,685
Projection Period	66,705	44.9%
Terminal Value	81,980	55.1%

(−) Current Net Debt	6,205

Equity Value	142,480
(/) Outstanding Shares	560

Fair Price	$254.43

Sensitivity Analysis

WACC \ Terminal Growth Rate	1.5%	2.0%	2.5%	3.0%	3.5%
6.4%	$331	$355	$385	$423	$475
7.4%	$274	$289	$306	$328	$355
8.4%	$233	$243	$254	$268	$284
9.4%	$203	$210	$218	$226	$237
10.4%	$180	$184	$190	$196	$203

Current price: $229.20. Green = undervalued, Red = overvalued.

Fair Value

$471.36

Market Price

$229.20

Upside / Downside

+105.7%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 3.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (86% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 21.7x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $471.45 per share, suggesting LOW is undervalued by 105.7% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

EV/EBITDA Exit Multiple

21.74x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,364
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,523
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,136
EBITDA	12,911	14,127	14,603	15,170	15,632	16,023

(−) Tax	2,446	2,719	2,815	2,935	3,026	—
(−) CapEx	1,839	2,044	2,116	2,206	2,275	—
(−) ΔWC	-264	931	331	410	310	—
Free Cash Flow (FCF)	8,889	8,434	9,340	9,618	10,022	—

Peers' EBITDA Multiple						21.7x
Terminal Value						348,340
WACC / Discount Rate	8.44%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	232,326

Enterprise Value	270,164
Projection Period	37,838	14.0%
Terminal Value	232,326	86.0%

(−) Current Net Debt	6,205
Equity Value	263,959
(÷) Outstanding Shares	560M
Fair Price	$471	+105.7%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	17.7x	19.7x	21.7x	23.7x	25.7x
6.4%	$431	$473	$515	$557	$599
7.4%	$413	$453	$493	$533	$573
8.4%	$395	$433	$471	$510	$548
9.4%	$378	$415	$451	$488	$524
10.4%	$363	$397	$432	$467	$502

Current price: $229.20. Green = undervalued, Red = overvalued.

Based on default parameters

Fair Value

$398.60

Market Price

$229.20

Upside / Downside

+73.9%

Verdict

Undervalued

Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Lowe's Companies, Inc.'s cash flows over 10 years with analyst estimates for the first 3–5 years, fading toward long-term GDP growth for the remaining years with line-by-line expense modeling. Revenue is projected revenue growing from -2.7% to 2.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 5, DPO 59, DIO 105). At a 8.4% WACC with mid-year discounting, the terminal value (71% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 21.7x to Year 11 EBITDA. After subtracting net debt, the equity value implies a fair price of $398.66 per share, suggesting LOW is undervalued by 73.9% at the current price of $229.20.

FCFF Present Value Calculation

WACC

8.44%

3% – 20%

EV/EBITDA Exit Multiple

21.74x

1x – 40x

Forecast Period

5 Yrs

+ Terminal Year

Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.

Currency: USD Millions

	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	Terminal
Profit Before Tax	9,752	10,837	11,223	11,701	12,062	12,260	12,162	12,181	12,315	12,567	12,881
(−) Net Interest	1,202	1,335	1,383	1,442	1,486	1,510	1,498	1,501	1,517	1,548	1,587
(+) D&A	1,957	1,954	1,997	2,028	2,084	2,096	2,191	2,240	2,277	2,300	2,357
EBITDA	12,911	14,127	14,603	15,170	15,632	15,866	15,851	15,922	16,109	16,415	16,826

(−) Tax	2,446	2,719	2,815	2,935	3,026	3,075	3,051	3,056	3,089	3,153	—
(−) CapEx	1,839	2,044	2,116	2,206	2,275	2,312	2,293	2,297	2,322	2,370	—
(−) ΔWC	-264	931	331	410	310	169	-84	16	115	217	—
Free Cash Flow (FCF)	8,889	8,434	9,340	9,618	10,022	10,310	10,590	10,553	10,582	10,676	—

Peers' EBITDA Multiple											21.7x
Terminal Value											365,792
WACC / Discount Rate	8.44%

Timing of FCF (mid year)	0.5	1.5	2.5	3.5	4.5	5.5	6.5	7.5	8.5	9.5	5
Present Value of FCF	8,537	7,469	7,628	7,244	6,960	6,603	6,255	5,748	5,315	4,945	162,714

Enterprise Value	229,419
Projection Period	66,705	29.1%
Terminal Value	162,714	70.9%

(−) Current Net Debt	6,205
Equity Value	223,214
(÷) Outstanding Shares	560M
Fair Price	$399	+73.9%

Sensitivity Analysis

WACC \ EV/EBITDA Exit Multiple	17.7x	19.7x	21.7x	23.7x	25.7x
6.4%	$404	$437	$469	$501	$533
7.4%	$373	$403	$432	$461	$491
8.4%	$345	$372	$399	$425	$452
9.4%	$320	$344	$368	$393	$417
10.4%	$296	$318	$341	$363	$385

Current price: $229.20. Green = undervalued, Red = overvalued.

Based on default parameters

Trading Multiples

Fair Value

$370.10

Market Price

$229.20

Upside / Downside

+61.5%

Verdict

Undervalued

Using the industry peer median P/E Multiples multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $370.10 based on 8 comparable companies in the Home Improvement industry.

P/E Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing P/E	Forward P/E
Lowe's Companies, Inc.LOW	128,352	19.3x	18.2x
The TJX Companies, Inc.TJX	170,980	31.7x	33.0x
Booking Holdings Inc.BKNG	128,576	25.1x	15.8x
Starbucks CorporationSBUX	118,825	64.0x	48.4x
MercadoLibre, Inc.MELI	82,764	41.4x	40.4x
O'Reilly Automotive, Inc.ORLY	77,780	31.3x	28.5x
Royal Caribbean Cruises Ltd.RCL	75,328	18.0x	16.2x
NIKE, Inc.NKE	65,255	20.4x	29.6x
Sea LimitedSE	54,291	35.2x	25.1x
Industry Median		31.5x	29.1x
(*) Profit after tax		6,654	7,052
Equity Value		209,453	205,056
(/) Outstanding shares		560	560
Fair Price		$374	$366

Selected Fair Value (avg of trailing + forward)

$370.10

+61.5%

Fair Value

$410.88

Market Price

$229.20

Upside / Downside

+79.3%

Verdict

Undervalued

Using the industry peer median EV/EBITDA multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $410.88 based on 8 comparable companies in the Home Improvement industry.

EV/EBITDA Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/EBITDA	Forward EV/EBITDA
Lowe's Companies, Inc.LOW	128,352	12.6x	11.6x
The TJX Companies, Inc.TJX	170,980	21.9x	22.0x
Booking Holdings Inc.BKNG	128,576	14.2x	13.0x
Starbucks CorporationSBUX	118,825	26.4x	26.6x
MercadoLibre, Inc.MELI	82,764	25.4x	25.6x
O'Reilly Automotive, Inc.ORLY	77,780	21.6x	20.2x
Royal Caribbean Cruises Ltd.RCL	75,328	14.1x	12.9x
NIKE, Inc.NKE	65,255	15.3x	15.3x
Sea LimitedSE	54,291	27.5x	21.4x
Industry Median		21.7x	20.8x
(*) EBITDA		10,688	11,557
= Enterprise Value		232,408	240,188
(-) Net Debt		6,205	6,205
Equity Value		226,203	233,983
(/) Outstanding shares		560	560
Fair Price		$404	$418

Selected Fair Value (avg of trailing + forward)

$410.88

+79.3%

Fair Value

$548.78

Market Price

$229.20

Upside / Downside

+139.4%

Verdict

Undervalued

Using the industry peer median EV/Revenue multiple (trailing + forward), Lowe's Companies, Inc. (LOW) has a fair value of $548.78 based on 8 comparable companies in the Home Improvement industry.

EV/Revenue Valuation — Home Improvement

USD in millions except Fair Price. Subject company highlighted.

	Mkt Cap ($M)	Trailing EV/Revenue	Forward EV/Revenue
Lowe's Companies, Inc.LOW	128,352	1.6x	1.4x
The TJX Companies, Inc.TJX	170,980	3.1x	3.1x
Booking Holdings Inc.BKNG	128,576	4.9x	4.4x
Starbucks CorporationSBUX	118,825	3.8x	3.8x
MercadoLibre, Inc.MELI	82,764	3.1x	3.2x
O'Reilly Automotive, Inc.ORLY	77,780	4.8x	4.5x
Royal Caribbean Cruises Ltd.RCL	75,328	5.4x	5.0x
NIKE, Inc.NKE	65,255	1.5x	1.5x
Sea LimitedSE	54,291	2.2x	1.7x
Industry Median		3.5x	3.5x
(*) Revenue		86,286	93,303
= Enterprise Value		300,120	326,928
(-) Net Debt		6,205	6,205
Equity Value		293,915	320,723
(/) Outstanding shares		560	560
Fair Price		$525	$573

Selected Fair Value (avg of trailing + forward)

$548.78

+139.4%

PEG Fair Value

Fair Value

$108.55

Market Price

$229.20

Upside / Downside

-52.6%

Verdict

Overvalued

PEG Ratio

2.11Expensive

01.02.03.0+

PEG = P/E ÷ (Growth + Yield) = 18.2 ÷ (6.6% + 2.1%) = 2.11

PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.

Growth Category: Slow GrowerPEG less reliable

PEG tends to undervalue slow growers — consider dividend yield and asset value instead.

Fair Value Calculation

EPS Growth RateForward	6.6%
Dividend Yield	+2.1%
Adjusted Growth (clamped 8–25%)	8.6%
Fair P/E	8.6x
NTM EPS (FY2027)	$12.59
Fair Value	$108.55

Growth Analysis

Forward GrowthActive

Period	EPS Est.	Growth	Analysts
FY2025 (actual)	$11.85	—	—
FY2027E	$12.59	+6.3%	24
FY2028E	$13.63	+8.2%	23
FY2029E	$15.00	+10.1%	16
FY2030E	$16.46	+9.7%	8
FY2031E	$17.36	+5.4%	7

6Y Forward EPS CAGR: 6.6%

Historical Growth

Year	Net Income	EPS	YoY
FY2021	$8.4B	$12.03	—
FY2022	$6.4B	$10.17	-15.5%
FY2023	$7.7B	$13.20	+29.8%
FY2024	$7.0B	$12.23	-7.3%
FY2025	$6.7B	$11.85	-3.1%

4Y Historical EPS CAGR: -0.4%

Earnings Power Value

Fair Value

$167.39

Market Price

$229.20

Upside / Downside

-27.0%

Verdict

Overvalued

Currency: USD Millions

	Low	Selected	High
Normalized Earnings	8,433	8,433	8,433
(/) WACC	9.9%	8.4%	6.9%
Enterprise Value	84,857	99,942	121,550
(-) Net debt	6,205	6,205	6,205
Equity Value	78,652	93,737	115,345
(/) Outstanding shares	560	560	560
Fair Price	$140.45	$167.39	$205.97

Dividend Discount Model

Fair Value

$119.63

Market Price

$229.20

Upside / Downside

-47.8%

Verdict

Overvalued

Dividend Profile

Current DPS

$4.71

Dividend Yield

2.05%

Payout Ratio

39.6%

Dividend Coverage

2.52x

FCF Payout Ratio34.5%

DPS CAGR (4Y)13.5%

Historical Dividends Per Share

Year	DPS	Payout Ratio	YoY Growth
2025	$4.71	39.6%	+4.1%
2024	$4.52	36.9%	+4.3%
2023	$4.33	32.8%	+15.4%
2022	$3.76	36.8%	+32.3%
2021	$2.84	23.5%	—

Dividend Projections (5-Year)

Year	Projected DPS	Growth	Discount Factor	Present Value
2026	$5.22	10.9%	0.9236	$4.82
2027	$5.79	10.9%	0.8530	$4.94
2028	$6.42	10.9%	0.7879	$5.06
2029	$7.12	10.9%	0.7277	$5.18
2030	$7.90	10.9%	0.6721	$5.31
Terminal Value	$8.10 DPS	2.5%		$94.31

PV of Projected Dividends$25.32

PV of Terminal Value$94.31

Fair Value per Share$119.63

Sensitivity Analysis

Fair value under different Cost of Equity (rows) and DPS Growth Rate (columns) assumptions.

Ke \ Growth	8.9%	9.9%	10.9%	11.9%	12.9%
6.3%	$170	$177	$185	$193	$202
7.3%	$134	$140	$146	$152	$158
8.3%	$110	$115	$120	$125	$130
9.3%	$93	$97	$101	$106	$110
10.3%	$81	$84	$88	$91	$95