Lowe's (LOW) - Get Lowe's Companies, Inc. Report posted stronger-than-expected second quarter earnings Wednesday, and raised its full-year revenue outlook, but followed its larger rival Home Depot (HD) - Get Home Depot, Inc. Report with disappointing same-store sales at its U.S. outlets.
Lowe's said adjusted earnings for the three months ending on July 30 were pegged at $4.25 per share, a 13.6% increase from the same period last year and firmly ahead of the Street consensus forecast of $3.99 per share.
Group revenues, Lowe's said, rose 1.1% to $27.6 billion, topping analysts' estimates of a $26.8 billion tally. U.S. same-store sales, however, fell 2.2%.
"Our strong results this quarter demonstrate that our Total Home strategy is working, with U.S. sales comps up 32% on a two-year basis. In the quarter, we drove 21% growth in Pro, 10% growth in Installation Services and strong comps across Décor product categories," said CEO Marvin Ellison.
"I would like to thank our front-line associates for their continued dedication to serving our customers and supporting safety in our stores," he added. "Looking forward, I am confident in the positive outlook for our industry, and our ability to drive operating margin expansion and market share gains."
Lowe's shares, which slumped 5.8% yesterday following a disappointing release from Home Depot, were marked 11% higher in early trading to change hands at $202.40 each.
Looking into the second half of the year, Lowe's said it sees revenues in the region of $92 billion, just ahead of the Refinitiv forecast of $91.6 billion, based on a 20% gain in comparable sales on a 2-year basis. .
Home Depot, in fact, posted record second quarter revenues Tuesday as the red-hot housing market bolstered home improvement spending and ticket levels, but same-store sales growth for its U.S. outlets slowed to 3.4% from last quarter's 29.9% tally, hammering the stock during yesterday's session.
Home Depot said earnings for the three months ending on August 1, the company's fiscal second quarter, were pegged at $4.53 per share, up 12.7% from the same period last year and well ahead of the Street consensus forecast of $4.43 per share. Group revenues, Home Depot said, rose 8% to $41.1 billion, again topping analysts' estimates of a $40.73 billion tally.
Same store sales were up 4.5% from last year, Home Depot said, just ahead of the Refinitiv forecast of 4.25%, while average tickets rose 11.3% to $82.48 per trip, helping the overall revenue increase even amid the slowing domestic traffic.