“They need to really sharpen their strategy around big-ticket, around promotions, get the right product in there, and then maybe later in the summer it’s a name you start to take a look at,” added Horvers.
Horvers has a “neutral” rating on Lowe’s, with a $31 price target — for which he’s prepared to wait.
“With turnarounds in retail you have to be very patient. You get out of the way for the hard part, and then you own it when things start to get better,” added Horvers. “We're in the hard part now with Lowe’s.”
As spring-related sales slow, both analysts are anticipating things to get worse before they get better.
“I think you probably just got the best comp for the year, and I agree with Chris. From here, you’ll get deceleration,” said Binder.
—By CNBC’s Jennifer Leigh Parker
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Neither Christopher Horvers nor Daniel Binder own LOW or HD shares. Horvers’ firm, JPMorgan, acted as lead or co-manager in a public offering of equity and/or debt securities for Lowe’s within the past 12 months, and has received compensation in that time from the company.
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