April 22, 2026 a 03:31 am
LOW: Dividend Analysis - Lowe's Companies, Inc.
Lowe's Companies, Inc. provides an attractive dividend profile, characterized by a steady growth pattern and robust dividend history. Despite some concerns about recent earnings volatility, the company maintains a reliable payout ratio, ensuring dividends remain sustainable. Investing in Lowe's aligns well with dividend growth investors seeking moderate but consistent returns, backed by a solid balance sheet and operational efficiencies.
📊 Overview
The dividend profile of Lowe's showcases a commitment to shareholder returns while balancing capital reinvestment. Its impressive 42-year dividend history, combined with a competitive yield, underscores reliability. Understanding this profile is critical for evaluating its income potential and risk exposure in the retail sector.
| Category | Data |
|---|---|
| Sector | Retail |
| Dividend yield | 1.43% |
| Current dividend per share | 4.72 USD |
| Dividend history | 42 years |
| Last cut or suspension | None |
🗣️ Dividend History
Lowe's long-standing dividend payments indicate a resilient business model capable of enduring market fluctuations. Such consistency is a strong indicator of a company's commitment to rewarding its shareholders.
| Year | Dividend Per Share (USD) |
|---|---|
| 2026 | 2.40 |
| 2025 | 4.70 |
| 2024 | 4.50 |
| 2023 | 4.30 |
| 2022 | 3.70 |
📈 Dividend Growth
Dividend growth is a critical measure of a company's ability to increase shareholder returns over time. Steady growth indicates strong future prospects and financial health.
| Time | Growth |
|---|---|
| 3 years | 8.30% |
| 5 years | 15.87% |
The average dividend growth is 15.87% over 5 years. This shows moderate but steady dividend growth.
📉 Payout Ratio
The payout ratio is a vital metric for understanding the sustainability of dividend payments. A balanced ratio suggests that the company maintains enough earnings to support future growth while rewarding investors.
| Key Figure | Ratio |
|---|---|
| EPS-based | 39.62% |
| Free cash flow-based | 34.57% |
Both the EPS payout ratio of 39.62% and the FCF payout ratio of 34.57% suggest a sustainable dividend policy, leaving room for growth.
✅ Cashflow & Capital Efficiency
Strong cash flow metrics reflect a company's efficiency in generating liquid capital for operations, investments, and shareholder returns. Capex and stock compensation ratios further show investment and structure.
| Year | 2025 | 2024 | 2023 |
|---|---|---|---|
| Free Cash Flow Yield | 5.13% | 5.22% | 4.99% |
| Earnings Yield | 4.46% | 4.72% | 6.24% |
| CAPEX to Operating Cash Flow | 22.44% | 20.02% | 24.13% |
| Stock Compensation to Revenue | 0.29% | 0.26% | 0.24% |
| Free Cash Flow/Operating Cash Flow Ratio | 77.56% | 79.98% | 75.87% |
The metrics indicate efficient cash flow management, supporting dividend stability and potential reinvestment opportunities.
⚠️ Balance Sheet & Leverage Analysis
A robust balance sheet reflects a company's ability to manage debt alongside its assets and equity efficiently, ensuring long-term financial health and stability.
| Year | 2025 | 2024 | 2023 |
|---|---|---|---|
| Debt-to-Equity | -0.725 | -2.788 | -2.667 |
| Debt-to-Assets | 13.27% | 89.02% | 92.59% |
| Debt-to-Capital | -263.26% | 155.92% | 159.97% |
| Net Debt to EBITDA | 0.52 | 3.01 | 2.89 |
| Current Ratio | 1.08 | 1.09 | 1.23 |
| Quick Ratio | 0.19 | 0.16 | 0.14 |
The leverage ratios indicate a careful balance of debt management and asset utilization, underscoring financial resilience.
✅ Fundamental Strength & Profitability
A company's fundamental strength is reflected in profitability measures, indicative of its efficiency in generating earnings relative to its costs and capital employed.
| Year | 2025 | 2024 | 2023 |
|---|---|---|---|
| Return on Equity | -67.10% | -48.89% | -51.34% |
| Return on Assets | 12.29% | 15.61% | 17.82% |
| Net Margin | 7.71% | 8.31% | 8.94% |
| EBIT Margin | 10.14% | 12.69% | 13.49% |
| EBITDA Margin | 12.39% | 15.05% | 15.71% |
| Gross Margin | 33.48% | 31.25% | 31.41% |
| R&D to Revenue | 0% | 0% | 0% |
The profitability ratios indicate a strong operational foundation, supporting sustainable dividends and modest reinvestment opportunities.
📊 Price Development
✅ Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 4 | |
| Financial stability | 3 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Overall Score: 31/40
📉 Rating
Lowe's Companies, Inc. offers a moderate dividend yield with robust growth potential, backed by a strong history and effective cash flow management. Despite some leverage concerns, its financial foundation and operational efficiency make it a stable choice for long-term dividend investors. Thus, Lowe's receives a favorable investment recommendation.
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