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Lowe’s Companies Inc. (LOW) – Get the report posted slightly weaker-than-expected third-quarter results Wednesday, but a muted holiday outlook pushed stocks lower early in the session.
Lowe’s said adjusted earnings for the three months ending Nov. 1 were set at $ 1.98 per share, a 40.4% increase over the same period last year, but a penny lower than Street’s consensus forecast. The group’s revenues, Lowe’s said, rose 28.2% to $ 22.3 billion, beating analysts’ estimates by a total of $ 21.25 billion.
Looking at the closing months of the year, Lowe’s said it sees comparable sales growth of between 15% and 20% and adjusted earnings per share of between $ 1.10 and $ 1.20, compared to Refinitiv’s forecast of $ 1.17 per share.
“Strong execution has allowed us to meet continued overall demand as we have experienced growth of over 15% in all merchandising departments, growth of over 20% in all geographies. three digits in line, ”said CEO Marvin Ellison. “We continued to invest in the future growth of the business, including a $ 100 million investment during the quarter as part of an ongoing effort to reset the layout of our stores in the United States, this which makes them easier to shop with improved product adjacencies, especially for Pro customers. “
“Our omnichannel transformation continued in the third quarter with new investments in Lowes.com and our supply chain,” he added. “I remain confident that we are making the right strategic investments to ensure sustainable, long-term growth. I also want to thank our outstanding frontline associates for their unwavering commitment to customer service and safety.”
Lowe’s shares were marked down 5.4% late in the morning after the results were released to change hands at $ 151.10 each, a move that still leaves the stock with a 31% gain in the morning. in the past six months.
“The downside to our estimate was mainly due to a lower than expected gross margin improvement and higher labor and capital expenses, partially offset by stronger comps,” said Bradley Thomas , analyst at KeyBanc Capital Markets.
“We raised our comp estimate to a high of 26.0% for Street (October 20), but stressed our belief that even that estimate appeared to have upside potential. Since then, Street’s expectations have risen significantly. over the past month, and we believe investor expectations were even higher for comps, ”he added.
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