Lowe's Cos.  (LOW)  named J.C. Penney Co. (JCP) CEO Marvin Ellison as its new CEO. 

The announcement came on Tuesday, May 22. Ellison will take the helm on July 2. Lowe's is set to report earnings on Wednesday, May 23.

"I am thrilled to take on the role as Lowe's next president and CEO. Together, we will leverage Lowe's omnichannel capabilities to deliver the most simple and seamless customer experiences," said Ellison in a Lowe's press release.

Ellison was previously an executive at Home Depot Inc. (HD) , a direct competitor of Lowe's.

Ellison joined J.C. Penney in August 2015. After news of his departure broke, J.C. Penney reportedly announced that it will create a CEO team instead of appointing a singular CEO.

$JCP says with Ellison's departure, it will create an "Office of the CEO" - comprised of the CFO, Chief Customer Officer, Chief Information Officer and EVP of Supply Chain Mike Robbins. "These four leaders will share equal responsibility" until new CEO is named

— Carl Quintanilla (@carlquintanilla) May 22, 2018

J.C. Penney reported earnings on Thursday, May 17, which fell short of analysts expectations. Its reported earnings of $2.58 billion was below the $2.61 billion analysts were expecting. On the company's earnings call, Ellison claimed that J.C. Penney didn't meet revenue expectations due to bad weather.  

"By putting Ellison in his place, Lowe's has reassured the market that it will continue to be led by a seasoned retail executive," said Neil Saunders, managing director of GlobalData Retail on Tuesday.

When the market closed, J.C. Penney shares fell 6%, after sinking 10% in premarket trading, on the news. Lowe's shares were down nearly 2%.

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