Lowe’s Companies Inc. (NYSE: LOW) reported its most recent quarterly results before the markets opened on Wednesday. Judging by investors reaction to this report, Lowe’s transformation is going just fine, and analysts seem to agree.
24/7 Wall St. has included some highlights from the earnings report as well as what a few analysts are saying about the stock after the fact.
Lowe’s said that it had $2.07 in earnings per share (EPS) and $20.89 billion in revenue, while the consensus estimates from Thomson Reuters had called for $2.02 in EPS on revenue of $20.78 billion. In the fiscal second quarter of last year, the retailer posted EPS of $1.57 and $19.5 billion in revenue.
During the quarter, the company announced that it expects to close all 99 Orchard Supply Hardware stores, which are located in California, Oregon and Florida, as well as the distribution facility that services those stores, by the end of fiscal 2018.
Note that this was the first earnings report under new CEO Marvin Ellison, who had previously worked at Home Depot as the president of the northern and western divisions. The company also announced that it would be taking on David Denton from CVS as its new chief financial officer.
Merrill Lynch maintained a Buy rating and $113 price objective. According to the firm, the bottom line and comparable sales topped its estimates. Merrill Lynch noted that Lowe’s will close its Orchard Supply stores to focus on the core Lowe’s stores and lowered guidance to reflect rationalizations.
Wedbush maintained its Neutral rating for Lowe’s. The firm went on to say this:
Under new CEO Marvin Ellison, LOW is taking charge to close its Orchard Supply chain and reduce non-productive inventory, with plans to further revaluate real estate productivity and non-core businesses to focus on its core home improvement omni-channel retail business. These may be appropriate steps but likely will come with further investment and earnings pressure that the company plans to outline at its December analyst meeting. With turnaround prospects delayed and macro concerns rising, we remain NEUTRAL on LOW.
Loop Capital reiterated a Buy rating and raised its price target to $130 from $115, and Wells Fargo reiterated a Buy rating.
Shares of Lowe’s were last seen up about 6% at $106.05, with a consensus analyst price target of $109.10 and a 52-week trading range of $70.76 to $109.80.
24/7 Wall St.Essential Tips for Investing (Sponsored)
A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
