Lowes (LOW) earnings exceeded within the second quarter of 2021

A customer pushes a shopping cart to the entrance of a Lowe’s store in Concord, California on Tuesday, February 23, 2021.

David Paul Morris | Bloomberg | Getty Images

Lowe beat earnings estimates on Wednesday as home improvement projects boosted sales in the second quarter.

In pre-market trading, the stock rose more than 2%.

Here’s what the company reported for the second fiscal quarter ended July 30, versus Wall Street’s expectations, based on an analyst survey conducted by Refinitiv:

  • Earnings per share: $ 4.25 versus $ 4.01 expected
  • Revenue: $ 27.57 billion versus an expected $ 26.85 billion

Lowe’s profit rose $ 3.02 billion or $ 4.25 per share of $ 2.83 billion or $ 3.74 per share, a year earlier. The results surpassed what analysts surveyed by Refinitiv had expected to be $ 4.01 per share.

Net sales rose to $ 27.57 billion from $ 27.30 billion last year, exceeding analysts’ expectations of $ 26.85 billion.

The home improvement retailer has reported staggering growth quarter after quarter. However, this has resulted in an almost inevitable decline in sales growth as consumers get back to the world and spend their money on other ways, from booking vacations to planning parties.

Lowe’s same-store sales, a key retail metric, declined 1.6% for the quarter. That was a slightly stronger performance than expected, as analysts had predicted a decline of 2.2%, according to StreetAccount. US sales decreased 2.2% but increased 32% over a two year period. During the same period last year, Lowe’s rolled out big numbers, including a 35.1% growth in sales in the same store and a nearly 69% increase in quarterly earnings.

Lowe’s CEO Marvin Ellison said in a press release that the company’s home professional business grew 21% in the second quarter. The company has tried to attract the more lucrative, reliable customers with a new loyalty program and other perks. He said the retailer’s installation services were up 10% and had strong home decor sales.

Lowe’s expects sales of approximately $ 92 billion this year, representing a 30% increase in sales in the same business on a two-year basis. It also said it plans to buy back at least $ 9 billion of its shares.

Ellison, who leads the company’s turnaround, said Lowe’s will continue to focus on making higher profits through higher productivity.

Lowe’s rival Home Depot fell short of expectations for sales in the same store in the second quarter as some customers’ appetites for do-it-yourself projects waned. The company also declined to provide an outlook for the year, citing uncertainty about factors ranging from issues in the supply chain to the impact of the Delta option on consumer spending. Shares closed Tuesday 4.27% to $ 320.75.

Lowe’s shares closed 5.8% to $ 182.26 on Tuesday following Home Depot’s earnings report. So far this year they have increased by around 14%.

Read the company’s press release here.

Correction: A previous headline misrepresented sales growth in the same store. Sales in the same store were down 1.6% in the quarter.

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