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How is Lowe's (LOW) Poised Ahead of Q2 Earnings Release?
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Lowe's Companies, Inc. (LOW - Free Report) is likely to register a decrease in the top line from the year-ago fiscal quarter’s respective readings when it reports second-quarter fiscal 2023 earnings on Aug 22, before the opening bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $24,936 million, indicating an 9.2% decline from the year-earlier fiscal quarter’s reported figure.
The consensus estimate for earnings has been stable in the past 30 days at $4.49 per share, suggesting 3.9% dip from the year-ago fiscal quarter’s tally.
In the last reported quarter, LOW delivered an earnings surprise of 5.5%. We note that this home-improvement retailer has a trailing four-quarter earnings surprise of 3.7%, on average.
Key Factors to Note
Lowe's quarterly results are likely to have been hurt by a tough operating backdrop, including inflationary pressures and currency headwinds. Additionally, stronger-than-anticipated pullback in home-improvement spending, lumber deflation and weaker-than-expected DIY discretionary sales are likely to have acted as deterrents. These headwinds, coupled with any deleverage in selling, general & administrative costs and other expenses, are expected to have hurt the company’s performance in the fiscal second quarter. Lowe’s has been investing in wage increases and bonuses.
On its last earnings call, management had projected nearly $400 million headwind to sales in the fiscal second quarter owing to the timing shift in the company’s fiscal calendar. Lumber deflation will also pressurize sales by about 150 basis points in the same quarter.
Nonetheless, Lowe’s focus on enhancing the omnichannel retailing capabilities in store operations, website and supply chain to resonate well with customers’ demand, appears encouraging. In addition, its pro business and Total Home strategy have been contributing to the company’s performance. All these strengths are likely to have provided some cushion to LOW’s performance in the quarter to be reported. For the fiscal second quarter, management had earlier anticipated adjusted operating margins to be slightly above the year-ago results, partly due to the effect of the shift in its fiscal calendar and the timing of several productivity initiatives.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Lowe's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
The company is expected to register bottom-line growth when it reports second-quarter fiscal 2023 results. The Zacks Consensus Estimate for quarterly earnings per share of 15 cents suggests an increase of 275% from the year-ago quarter.
American Eagle Outfitters’ top line is anticipated to fall year over year. The consensus mark for revenues is pegged at $1.18 billion, indicating a drop of 1.3% from the figure reported in the year-ago quarter.
Casey's General Stores (CASY - Free Report) currently has an Earnings ESP of +1.03% and a Zacks Rank of 3. The company is expected to register a bottom-line decrease when it reports first-quarter fiscal 2024 results. The Zacks Consensus Estimate for quarterly earnings per share of $3.39 suggests a decline of 17.1% from the year-ago quarter.
Casey's top line is anticipated to fall year over year. The consensus mark for revenues is pegged at $3.85 billion, indicating a drop of 13.5% from the figure reported in the year-ago quarter. CASY has a trailing four-quarter earnings surprise of 7.5%, on average.
Five Below (FIVE - Free Report) currently has an Earnings ESP of +1.33% and a Zacks Rank of 3. FIVE is likely to register top-line improvement when it reports second-quarter fiscal 2023 numbers.
The Zacks Consensus Estimate for Five Below’s quarterly revenues is pegged at $760.5 million, calling for growth of 13.7% from the prior-year quarter’s reported figure. The consensus mark for the quarterly earnings per share of 83 cents suggests a 12.2% increase from the figure reported in the year-ago quarter. FIVE has a trailing four-quarter earnings surprise of 27.9%, on average.
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How is Lowe's (LOW) Poised Ahead of Q2 Earnings Release?
Lowe's Companies, Inc. (LOW - Free Report) is likely to register a decrease in the top line from the year-ago fiscal quarter’s respective readings when it reports second-quarter fiscal 2023 earnings on Aug 22, before the opening bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $24,936 million, indicating an 9.2% decline from the year-earlier fiscal quarter’s reported figure.
The consensus estimate for earnings has been stable in the past 30 days at $4.49 per share, suggesting 3.9% dip from the year-ago fiscal quarter’s tally.
In the last reported quarter, LOW delivered an earnings surprise of 5.5%. We note that this home-improvement retailer has a trailing four-quarter earnings surprise of 3.7%, on average.
Key Factors to Note
Lowe's quarterly results are likely to have been hurt by a tough operating backdrop, including inflationary pressures and currency headwinds. Additionally, stronger-than-anticipated pullback in home-improvement spending, lumber deflation and weaker-than-expected DIY discretionary sales are likely to have acted as deterrents. These headwinds, coupled with any deleverage in selling, general & administrative costs and other expenses, are expected to have hurt the company’s performance in the fiscal second quarter. Lowe’s has been investing in wage increases and bonuses.
On its last earnings call, management had projected nearly $400 million headwind to sales in the fiscal second quarter owing to the timing shift in the company’s fiscal calendar. Lumber deflation will also pressurize sales by about 150 basis points in the same quarter.
Nonetheless, Lowe’s focus on enhancing the omnichannel retailing capabilities in store operations, website and supply chain to resonate well with customers’ demand, appears encouraging. In addition, its pro business and Total Home strategy have been contributing to the company’s performance. All these strengths are likely to have provided some cushion to LOW’s performance in the quarter to be reported. For the fiscal second quarter, management had earlier anticipated adjusted operating margins to be slightly above the year-ago results, partly due to the effect of the shift in its fiscal calendar and the timing of several productivity initiatives.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Lowe's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Lowe's Companies, Inc. Price and EPS Surprise
Lowe's Companies, Inc. price-eps-surprise | Lowe's Companies, Inc. Quote
Lowe's has an Earnings ESP of -1.14% and a Zacks Rank of 3.
Stocks With The Favorable Combination
Here are a few companies, which according to our model, have the right combination to beat on earnings this reporting cycle:
American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +11.07% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is expected to register bottom-line growth when it reports second-quarter fiscal 2023 results. The Zacks Consensus Estimate for quarterly earnings per share of 15 cents suggests an increase of 275% from the year-ago quarter.
American Eagle Outfitters’ top line is anticipated to fall year over year. The consensus mark for revenues is pegged at $1.18 billion, indicating a drop of 1.3% from the figure reported in the year-ago quarter.
Casey's General Stores (CASY - Free Report) currently has an Earnings ESP of +1.03% and a Zacks Rank of 3. The company is expected to register a bottom-line decrease when it reports first-quarter fiscal 2024 results. The Zacks Consensus Estimate for quarterly earnings per share of $3.39 suggests a decline of 17.1% from the year-ago quarter.
Casey's top line is anticipated to fall year over year. The consensus mark for revenues is pegged at $3.85 billion, indicating a drop of 13.5% from the figure reported in the year-ago quarter. CASY has a trailing four-quarter earnings surprise of 7.5%, on average.
Five Below (FIVE - Free Report) currently has an Earnings ESP of +1.33% and a Zacks Rank of 3. FIVE is likely to register top-line improvement when it reports second-quarter fiscal 2023 numbers.
The Zacks Consensus Estimate for Five Below’s quarterly revenues is pegged at $760.5 million, calling for growth of 13.7% from the prior-year quarter’s reported figure. The consensus mark for the quarterly earnings per share of 83 cents suggests a 12.2% increase from the figure reported in the year-ago quarter. FIVE has a trailing four-quarter earnings surprise of 27.9%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.