Lowe’s Q1 results: same-store sales decline is not ‘that big of a deal’
- Lowe's reports lower-than-expected sales for its fiscal first quarter.
- Oppenheimer analyst reacts to earnings report on CNBC Squawk Box.
- Shares of the home improvement retailer are down 4.0% this morning.
Shares of Lowe’s Companies Inc (NYSE: LOW) are down 4.0% on Wednesday after the home improvement retailer blamed unseasonably cold temperature for lower-than-expected sales in fiscal Q1.
Key takeaways from Lowe’s Q1 results
- Net income came in at $2.33 billion that translates to $3.51 per share.
- In Q1 last year, net income was $2.32 billion or $3.21 per share.
- Sales slid 3.1% YoY to $23.66 billion, as per the earnings press release.
- FactSet consensus was for $3.22 of EPS on $23.77 billion in sales.
- Same-store sales were down 4.0% versus a 2.5% decline expected.
A 3.8% decline in U.S. comparable sales, however, was better than a 4.2% decline that experts had forecast.
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For fiscal 2022, Lowe’s reiterated its guidance for EPS in the range of $13.10 to $13.60 on up to $99 billion in revenue. The Mooresville-headquartered company plans on buying back $12 billion worth of its stock.
Oppenheimer analyst reacts to the earnings report
According to Oppenheimer’s Brian Nagel, a 4.0% decline in Lowe’s comparable sales is not “that big of a deal”, even after peer Home Depot reported same-store sales growth yesterday. On CNBC’s “Squawk Box”, he said:
Lowe’s is more focused on the outdoor DIY category. Home Depot yesterday said there’s been a slower start to Spring. But as the spring weather has finally come, these seasonal products have picked up. I think Lowe’s will say the same.
He sees the stock down more than 25% from its year-to-date high as “quite cheap”.