Lowe's Q2 Earnings Beat Street, Adds Market Share, But Lowers FY Guidance

Lowe's reported Q2 net income increased 9% to $1.02 billion, or $0.67/share, on a 5.8% rise in revenues to $14.17B, topping analysts' average estimate of $0.61 on sales of $14.13B. In a press release, Lowe's said it continued to capture market share during the quarter despite what it called a "challenging sales environment," as macro economic factors pressure the home improvement industry. Lowe's noted "regionally disparate performance" in the housing market having an impact on comparable store sales. Overall, comps declined 2.6%, but CEO Robert Niblock explained that "many of the difficult comparisons we faced during the last four quarters are beginning to lessen as we cycle hurricane recovery spending and deflationary price pressures from lumber and plywood." Lowe's expects Q3 EPS of $0.43 - $0.45, compared to analyst expectations of $0.47. Lowe's cut its full-year EPS guidance to $1.97 - $2.01, from $1.99 - $2.03 previously. Analysts had forecast $1.97, on average. Shares of Lowe's were last up 6.1% to $28.52 in light pre-market trading. Lowe's gained 0.2% to $26.87 on Friday.

Sources: Press release, Bloomberg, MarketWatch
Commentary: Berkshire Hathaway Releases Latest 13F: Summary of Holdings • Lowe's Is Becoming Enticing • Home Depot vs Lowe's: Go With Oprah's Choice
Stocks/ETFs to watch: LOW. Competitors: HD, BLDR, BLG. ETFs: RTH, XLY, XHB, PKB

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