Marvin Ellison's honeymoon in Lowe's, California is about to end. Investors have increased their shares since taking office as chief executive in July, but a gloomy fourth quarter could change that.
Fourth-quarter revenue was little changed, at $ 15.6 billion, from the $ 15.7 billion estimate. A 1.7% gain in same store sales also missed expectations.
– Bad weather, including a historic cold snap, may have played a role in poor performance. Home Depot Inc., which disappointed investors Tuesday with its results, said the snow, cold and rain in the last quarter had reduced the growth in same-store sales by 1 point.
-Lowe's and Home Depot are often viewed as approximations of confidence in the US housing market. When homeowners think prices will continue to rise, they are spending more. Values have risen steadily since the recession, but have been weak recently, raising concerns about the future growth of home renovation chains.
-The company also exposed its sales forecast for the current fiscal year, indicating that revenue would increase by 2% and diluted earnings per share would be between $ 6 and $ 6.10.
-Ellison, a former Home Depot executive, joined Lowe's in July and was busy reorganizing management and operations while closing stores. Investors were satisfied with the title, which has gained about 9% since his arrival. They will know much more in the coming months, as the company enters the busiest sales season.
-Lowe's shares gained 14% this year until the close of Tuesday.