Lowe's Companies (LOW) - Get Lowe's Companies Inc. Report posted stronger-than-expected third quarter earnings Wednesday, and lifted its full-year profit guidance, offering a stark contrast to its larger home improvement rival Home Depot (HD) - Get Home Depot Inc. (The) Report .
Lowe's said earnings for the three months ending on November 1 came in at $1.41 per share, up 35.6% from the same period last year and firmly ahead of the Street consensus forecast of $1.35 per share. Group revenues, Lowe's said, were largely flat from last year at $17.4 billion, but fell just shy of analysts' estimates of a $17.68 billion tally.
Lowe's also said it expects full-year earnings in the range of $5.63 to $5.70 per share, up from a prior forecast of $5.45 to $5.65 per share, and reiterated its forecast of full-year comparable sales growth of around 3%.
"We were pleased with the performance of our U.S. home improvement stores, which reflects a solid macroeconomic backdrop and continued progress in our transformation driven by investments in customer experience, improved merchandise category performance, and continued growth of our Pro business," said CEO Marvin Ellison. "Due to improved execution, we delivered strong earnings per share growth, and as a result, we are raising our adjusted earnings per share and adjusted operating income guidance for 2019."
Lowe's shares were marked 5.8% higher at the start of trading Wednesday to change hands at $120.06 each, and all time high and a move move that extends the stock's year-to-date gain to around 30%.
Lowe's also said it would close around 34 of its underperforming stores in Canada, following a strategic review of its non-US business, and expects a charge of between $175 million and $225 million from fourth quarter inventory liquidation.
Lowe's update follows a weaker-than-expected third quarter earnings report from its larger rival, Home Depot, which cut it full-year sales estimate early on Tuesday and sent shares tumbling 5.44%.
Home Depot said it sees full-year sales rising 1.8%, down from a prior forecast of 2.3%, and sees comparable store sales growth of 3.5% compared to its earlier estimate of 4%. The group reaffirmed its full-year diluted earnings growth of 3.1% from last year's total of $10.03 per share.