We downgraded our recommendation on
Lowe's Companies (
LOW) to Underperform following dismal second-quarter 2012 results. The quarterly earnings of $0.65 per share missed the Zacks Consensus Estimate of $0.70, and fell 4.4% year-over-year. Net sales slid 2% to $14,249 million, and fell short of the Zacks Consensus Estimate of $14,421 million.
Consequently, Lowe's trimmed its outlook, as it remains concerned about the housing market and the sluggish economic recovery. Management now expects fiscal 2012 earnings to be $1.64, down from a range of $1.73 to $1.83 per share forecasted earlier. Management now projects total sales for fiscal 2012 to remain flat with fiscal 2011, and expects comparable-store sales growth of 0.5%.
We believe that spending on big remodeling projects will likely remain under pressure until the housing market stabilizes, inventory levels normalize and consumer-spending rebounds. Our target price of $28.00, 17.0X 2012 EPS, reflects this view.
This page is temporarily not available. Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext. 9339.
Consequently, Lowe's trimmed its outlook, as it remains concerned about the housing market and the sluggish economic recovery. Management now expects fiscal 2012 earnings to be $1.64, down from a range of $1.73 to $1.83 per share forecasted earlier. Management now projects total sales for fiscal 2012 to remain flat with fiscal 2011, and expects comparable-store sales growth of 0.5%.
We believe that spending on big remodeling projects will likely remain under pressure until the housing market stabilizes, inventory levels normalize and consumer-spending rebounds. Our target price of $28.00, 17.0X 2012 EPS, reflects this view.
Read the full Analyst Reporton LOW