NEW YORK (TheStreet) -- Shares of Lowe's Companies Inc. are up by 1.38% to $74.42 in early afternoon trading on Thursday, following a ratings upgrade to "overweight" from "neutral" at Piper Jaffray. The firm said it raised its rating on the home improvement retailer as it believes Lowe's is operating in a favorable sales environment. Piper Jaffray has an $88 price target on Lowe's stock. The firm cited an increase in homeowner remodeling activity, a pickup in housing turnover, and earlier spring weather as its reasoning for the ratings upgrade. "We are admittedly late to the party, but we expect Lowe's shares to be a healthy relative outperformer within our coverage group over the next 12 months and current valuation even appears reasonable at 22x FTM EPS when compared against a basket of other large cap retailers that, on average, have a much slower EPS growth profile," Piper Jaffray said in an analyst note this morning. Separately, TheStreet Ratings team rates LOWE'S COMPANIES INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation: "We rate LOWE'S COMPANIES INC (LOW) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, revenue growth, notable return on equity and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins." Highlights from the analysis by TheStreet Ratings Team goes as follows: LOWE'S COMPANIES INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LOWE'S COMPANIES INC increased its bottom line by earning $2.70 versus $2.13 in the prior year. This year, the market expects an improvement in earnings ($3.30 versus $2.70). The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Specialty Retail industry average. The net income increased by 47.0% when compared to the same quarter one year prior, rising from $306.00 million to $450.00 million. Despite its growing revenue, the company underperformed as compared with the industry average of 12.9%. Since the same quarter one year prior, revenues slightly increased by 7.5%. Growth in the company's revenue appears to have helped boost the earnings per share. Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, LOWE'S COMPANIES INC has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500. Powered by its strong earnings growth of 58.62% and other important driving factors, this stock has surged by 56.18% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels. You can view the full analysis from the report here: LOW Ratings Report Must Read: Warren Buffett's Top 25 Stocks for 2015
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