LOW Profit Margins
Gross, Operating & Net Margin Analysis for Lowes Companies Inc
Margin Quality
Good
Current Profit Margins
Gross Margin
33.3%
$27.88B gross profit
Operating Margin
12.5%
$10.47B operating income
Net Profit Margin
8.3%
$6.96B net income
5-Year Margin Trends
What Margins Indicate About LOW
Business Quality
Moderate gross margins indicate Lowes Companies Inc operates in a competitive market with balanced pricing dynamics.
Operational Efficiency
Expanding operating margins show Lowes Companies Inc is improving operational leverage and cost management.
Profitability
Net margins in the 5-15% range are solid and typical for many profitable businesses.
Investment Implications
Mixed margin trends require deeper analysis to understand underlying business dynamics and sustainability.
Understanding Profit Margins
Gross Margin
(Revenue - Cost of Goods Sold) / Revenue. Measures pricing power and production efficiency before operating expenses.
Operating Margin
Operating Income / Revenue. Shows profitability from core operations after all operating expenses but before interest and taxes.
Net Profit Margin
Net Income / Revenue. The bottom line - shows how much profit the company keeps from each dollar of revenue after all expenses.
Analyze LOW Profitability
Get complete financial analysis with profitability trends, ROE, ROIC, and more
Frequently Asked Questions
What is LOW's profit margin?
LOW (Lowes Companies Inc) has a net profit margin of 8.3%, meaning the company keeps $0.08314410689102945 in profit for every dollar of revenue. This represents a change from the previous year's net margin of 8.3%.
What is LOW's gross margin?
LOW's gross margin is 33.3%. Gross margin measures the percentage of revenue remaining after subtracting the cost of goods sold. A moderate gross margin like this reflects the competitive dynamics of the Consumer Discretionary.
What is LOW's operating margin?
LOW has an operating margin of 12.5%. Operating margin shows profitability after operating expenses but before interest and taxes. The 12.5% year-over-year improvement suggests better operational efficiency.
Are LOW's profit margins good?
LOW's margins are considered good. When evaluating margins, it's important to compare against Specialty Retail peers, as different sectors have structurally different margin profiles.
How do profit margins affect LOW stock?
Profit margins are a key indicator of LOW's business quality and competitive position. The current margins should be evaluated alongside growth rates and return on capital to assess overall business quality. Expanding margins often lead to stock price appreciation, while contracting margins can signal competitive pressures.
What drives LOW's profit margins?
LOW's profit margins are influenced by several factors: pricing power vs competitors, operational efficiency, scale advantages, input costs (materials, labor), Specialty Retail-specific dynamics, and management execution. The significant expansion in gross margin suggests changes in these underlying drivers.
Disclaimer: Margin analysis is based on reported financial statements and should be compared to industry peers for context. Different sectors have structurally different margin profiles. This information is for educational purposes only and should not be considered financial advice.