Lowe’s Companies Inc (LOW) Earnings Preview 3Q


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Lowe’s Companies, Inc (NYSE:LOW) Earnings Preview 3Q

Lowe’s Companies  Inc (NYSE:LOW) will report 3rd Quarter Fiscal Year 2014 earnings before market open on Wednesday, November 19th, 2014.

The company recently hit a 52 week high of $58.76. Lowe’s like Home Depot operates out of the direct line of fire from online retail like Amazon. Lowe’s also stands to benefit from longer term improvement of housing. The home improvement sector should have appealing long-term growth characteristics from rising U.S. homeownership and favorable demographic data pointing to up-side for refurbishment spending. According to the latest Census bureau, approximately 69% of homes are more than 25 years old.

In the company’s 2nd Quarter conference call, the company indicated it had modestly lower sales outlook as a result of year-to-date performance. Despite this, the company maintained they will meet their full year earnings guidance through expense management.

Goal of Operating Margin Improvement

The company has set a goal of 65 basis points of Operating Margin through both gross margin and expense leverage and thus far have achieved 67 basis points through the first half of 2014.

2nd Quarter Outlook

Investors will look at updates to the company’s outlook. The company expects an increase of total sales of approximately 4.5% driven by a comp sales increase of 3.5% and the opening of 10 Home Improvement and 5 Orchard Supply locations.

Wall Street Expectations

Analysts are expecting the company to earn 58 cents per share up from 47 cents per share in the same period a year ago. Revenue is expected to be at ~$13.5 billion up from ~$13.0 billion in the 3rd quarter last year.

 

 

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