Quarterly numbers from Lowe's beat forecast, shares spark
By Abigail Townsend
Date: Wednesday 26 Feb 2025
(Sharecast News) - US retailer Lowe's Companies beat Wall Street expectations on Wednesday, prompting hopes that the home improvement market is picking up.
The Home Depot rival said comparable sales had returned to growth, ticking up 0.2% in the three months to 31 January, while net earnings rose to $1.13bn from $1.02bn a year previously.
Once a $80m pre-tax gain associated with the 2022 sales of Lowe's Canadian retail business was excluded, adjusted diluted earnings per share were $1.93. Wall Street had been looking for EPS of $1.84.
Net sales were largely flat, coming at $18.55bn, but ahead of forecasts for $18.29bn.
Higher borrowing costs have slowed the US housing market, which in turn has hit the home improvement segment.
Lowe's said it had benefited by solid professional and online sales during the quarter as well as a "strong" holiday performance and rebuilding efforts in the wake of recent hurricanes, all of which helped partially offset "continued near-term pressure in DIY discretionary spending".
Marvin Ellison, chief executive, said: "Our results this quarter were once again bigger than expected, as we continue to gain traction with our Total Home strategic initiatives.
"We remain confident in the long-term strength of the home improvement industry, and are equally confident in our strategy to capitalise on the expected recovery."
Looking to the current year, Lowe's forecast total sales of between $83.5bn an $84.5bn, with like-for-like sales growing by 0% to 1%.
Diluted EPS is expected to come in between $12.15 and $12.40.
Over the year to January end, net sales fell to $83.67bn from $86.38bn, while net earnings eased to $6.96bn from $7.73bn. Diluted EPS was $12.23.
As at 1215 GMT, shares in Lowe's - which has more than 1,700 stores - were up 4% in pre-market trading.
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