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Will Lowe's (LOW) Succeed in Reporting Higher Q2 Earnings?
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Lowe's Companies, Inc. (LOW - Free Report) is scheduled to report second-quarter fiscal 2018 results on Aug 22. In the preceding quarter, the company’s earnings lagged the Zacks Consensus Estimate by 2.5%. In the trailing four quarters, this home improvement retailer has underperformed the Zacks Consensus Estimate by an average of 4.6%.
Which Way Are Estimates Treading?
After registering bottom-line increase of 15.5% in the first quarter, Lowe's is likely to record year-over-year growth in the second quarter as well. The Zacks Consensus Estimate for the quarter under review is pegged at $2.02, reflecting year-over-year growth of roughly 28.7% from $1.57 reported in the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 30 days. Analysts polled by Zacks now project revenues of $20,807 million, up about 6.7% from the year-ago quarter.
Factors at Play An improving job scenario, housing market recovery and merchandising initiatives along with efforts to enhance omni-channel capabilities bode well for Lowe’s. Moreover, the company’s focus on strengthening its relationship with Pro customers is encouraging.
The buyout of Maintenance Supply Headquarters is enhancing the company’s relationship with Pro customers. Further, Lowe’s has refurbished its pro-service business website, LowesForPros.com, in order to cater to the needs of its Pro customers. The company’s Canadian and Mexican businesses have been doing pretty well. Meanwhile, the buyout of RONA has reinforced the company’s position in the Canadian market.
Lowe's Canada entered into a strategic partnership with Solar Brokers Canada to provide solar energy installation services to homeowners under Lowe's Solar banner. The company has been focusing on maintenance, repair and operations products, evident from its acquisition of Maintenance Supply Headquarters and also the earlier buyout of Central Wholesalers. Further, the company has entered into an agreement with Sherwin-William, one of the leading paint brands in the country, to boost sales of its paint products.
Undoubtedly, the above discussion makes us optimistic about Lowe’s performance in the soon-to-be-reported quarter. However, threats emerging from cannibalization and stiff competition cannot be ignored. Moreover, higher SG&A expenses may act as a headwind too.
Lowe's Companies, Inc. Price, Consensus and EPS Surprise
Our proven model shows that Lowe's is likely to beat estimates this quarter. A stock needs to have both a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Lowe's has a Zacks Rank #3 and an Earnings ESP of +0.71%. This makes us reasonably confident of an earnings beat.
3 More Stocks Poised to Beat Earnings Estimates
Here are three other companies you may want to consider as our model shows that these too have the right combination of elements to post earnings beat.
Kohl's Corporation (KSS - Free Report) has an Earnings ESP of +0.24% and a Zacks Rank #2.
Ross Stores (ROST - Free Report) has an Earnings ESP of +2.91% and a Zacks Rank #3.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Will Lowe's (LOW) Succeed in Reporting Higher Q2 Earnings?
Lowe's Companies, Inc. (LOW - Free Report) is scheduled to report second-quarter fiscal 2018 results on Aug 22. In the preceding quarter, the company’s earnings lagged the Zacks Consensus Estimate by 2.5%. In the trailing four quarters, this home improvement retailer has underperformed the Zacks Consensus Estimate by an average of 4.6%.
Which Way Are Estimates Treading?
After registering bottom-line increase of 15.5% in the first quarter, Lowe's is likely to record year-over-year growth in the second quarter as well. The Zacks Consensus Estimate for the quarter under review is pegged at $2.02, reflecting year-over-year growth of roughly 28.7% from $1.57 reported in the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 30 days. Analysts polled by Zacks now project revenues of $20,807 million, up about 6.7% from the year-ago quarter.
Factors at Play
An improving job scenario, housing market recovery and merchandising initiatives along with efforts to enhance omni-channel capabilities bode well for Lowe’s. Moreover, the company’s focus on strengthening its relationship with Pro customers is encouraging.
The buyout of Maintenance Supply Headquarters is enhancing the company’s relationship with Pro customers. Further, Lowe’s has refurbished its pro-service business website, LowesForPros.com, in order to cater to the needs of its Pro customers. The company’s Canadian and Mexican businesses have been doing pretty well. Meanwhile, the buyout of RONA has reinforced the company’s position in the Canadian market.
Lowe's Canada entered into a strategic partnership with Solar Brokers Canada to provide solar energy installation services to homeowners under Lowe's Solar banner. The company has been focusing on maintenance, repair and operations products, evident from its acquisition of Maintenance Supply Headquarters and also the earlier buyout of Central Wholesalers. Further, the company has entered into an agreement with Sherwin-William, one of the leading paint brands in the country, to boost sales of its paint products.
Undoubtedly, the above discussion makes us optimistic about Lowe’s performance in the soon-to-be-reported quarter. However, threats emerging from cannibalization and stiff competition cannot be ignored. Moreover, higher SG&A expenses may act as a headwind too.
Lowe's Companies, Inc. Price, Consensus and EPS Surprise
Lowe's Companies, Inc. Price, Consensus and EPS Surprise | Lowe's Companies, Inc. Quote
What the Zacks Model Unveils
Our proven model shows that Lowe's is likely to beat estimates this quarter. A stock needs to have both a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Lowe's has a Zacks Rank #3 and an Earnings ESP of +0.71%. This makes us reasonably confident of an earnings beat.
3 More Stocks Poised to Beat Earnings Estimates
Here are three other companies you may want to consider as our model shows that these too have the right combination of elements to post earnings beat.
Best Buy (BBY - Free Report) has an Earnings ESP of +1.46% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kohl's Corporation (KSS - Free Report) has an Earnings ESP of +0.24% and a Zacks Rank #2.
Ross Stores (ROST - Free Report) has an Earnings ESP of +2.91% and a Zacks Rank #3.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>