Lowe's Companies Inc (NYSE: LOW) shares declined 1.13% to $218.24 on Thursday following mixed second-quarter results and a reduction in full-year earnings guidance. Despite the pullback, analysts from JPMorgan and KeyBanc Capital Markets maintained their Overweight ratings, citing potential upside from tariff refunds and expected acceleration in comparable store sales during the second half of the year.

Analyst Perspectives

JPMorgan analyst Christopher Horvers reiterated an Overweight rating with a price target of $252. He noted that while second-quarter comparable sales missed expectations, margins excluding tariff refunds exceeded the implied guidance range of 13.3%-13.4%.

Horvers highlighted that management has de-risked its outlook by projecting flattish comps for the remainder of the year, despite several positive factors:

• Easier comparisons in the second half
• Easing DIY seasonal pressure, shifting mix toward pro/repair and maintenance
• Improving two-year trend observed in the second quarter

Management guided full-year earnings at $12.25 per share, implying a 7% decline in the third quarter to approximately $2.85 per share. Horvers identified remaining tariff refunds as a significant source of upside, estimating a potential boost of ~30 bps to the year.

KeyBanc Capital Markets analyst Bradley Thomas maintained an Overweight rating with a price target of $275. He attributed the mixed second-quarter performance to unfavorable weather, temporary competitive pressures, and sluggish industry trends. However, he noted that Lowe's reported comparable sales growth of 0.2%, marking the fifth consecutive quarter of positive comps.

Thomas expects comps to accelerate in the back half due to:

• July’s transitory promotional environment
• Likely receipt of significant tariff refunds in the third quarter
• Potential for storm activity

"While LOW lowered its 2026 guide (and we revise our estimates lower), we are optimistic that nearly all NT negative factors are baked into the stock, with the potential for underlying improvement ahead," Thomas wrote.

What the Numbers Show

The divergence between margin performance and top-line sales is notable. While comparable sales were below expectations, margins excluding tariff refunds came in well above the implied guidance of 13.3%-13.4%. This suggests that cost management or favorable product mix may have offset some pressure from sluggish DIY spending, although the impact of tariff refunds remains a key variable for full-year profitability.