Financial Analysis: Lowe’s Companies (NYSE:LOW) versus Travis Perkins (OTCMKTS:TPRKY)

Travis Perkins (OTCMKTS:TPRKY) and Lowe’s Companies (NYSE:LOW) are both retail/wholesale companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, risk, analyst recommendations and earnings.

Dividends

Travis Perkins pays an annual dividend of $0.14 per share and has a dividend yield of 1.4%. Lowe’s Companies pays an annual dividend of $4.60 per share and has a dividend yield of 1.7%. Lowe’s Companies pays out 38.4% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Travis Perkins and Lowe’s Companies”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Travis Perkins	$6.05 billion	0.40	$47.39 million	N/A	N/A
Lowe’s Companies	$86.38 billion	1.79	$7.73 billion	$11.99	22.72

Lowe’s Companies has higher revenue and earnings than Travis Perkins.

Analyst Recommendations

This is a breakdown of current ratings for Travis Perkins and Lowe’s Companies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Travis Perkins	0	0	0	0	0.00
Lowe’s Companies	0	10	15	0	2.60

Lowe’s Companies has a consensus target price of $277.92, indicating a potential upside of 2.02%. Given Lowe’s Companies’ stronger consensus rating and higher probable upside, analysts clearly believe Lowe’s Companies is more favorable than Travis Perkins.

Insider & Institutional Ownership

74.1% of Lowe’s Companies shares are held by institutional investors. 0.3% of Lowe’s Companies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

Travis Perkins has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, Lowe’s Companies has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500.

Profitability

This table compares Travis Perkins and Lowe’s Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Travis Perkins	N/A	N/A	N/A
Lowe’s Companies	8.19%	-47.55%	15.28%

Summary

Lowe’s Companies beats Travis Perkins on 12 of the 14 factors compared between the two stocks.

About Travis Perkins

Travis Perkins plc engages in distribution of building material products in the United Kingdom. It operates through Merchanting and Toolstation segments. The company offers tools and building supplies. It also distributes pipeline products, as well as supplies managed services, and commercial and industrial heating and cooling solutions. In addition, the company provides in specialist civils and drainage solutions; and air-conditioning and refrigeration products and heat pumps. Further, it provides insulation and interior building products to interior building specialists, contractors, and builders; and kitchens and joinery products. Additionally, the company manufactures and supplies staircases, i-joists, precision floor kits, painted MDF profiles, and door kits/sets. The company markets its products under Travis Perkins, Toolstation, BSS, Keyline, and CCF brands. It sells its products through branches and distribution centres, as well as online. Travis Perkins plc was founded in 1797 and is headquartered in Northampton, the United Kingdom.

About Lowe’s Companies

Lowe’s Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States. The company offers a line of products for construction, maintenance, repair, remodeling, and decorating. It also provides home improvement products, such as appliances, seasonal and outdoor living, lawn and garden, lumber, kitchens and bath, tools, paint, millwork, hardware, flooring, rough plumbing, building materials, décor, and electrical. In addition, the company offers installation services through independent contractors in various product categories; and extended protection plans and repair services. It sells its national brand-name merchandise and private brand products to professional customers, homeowners, renters, businesses, and government. The company also sells its products through Lowes.com website; and through mobile applications. Lowe’s Companies, Inc. was founded in 1921 and is based in Mooresville, North Carolina.