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Lowe’s Companies Inc. (LOW - Analyst Report), the world’s second largest home improvement retailer, is set to report its first-quarter fiscal 2013 results on May 22. In the last quarter it posted a positive surprise of 13%. Let’s see how things are shaping up for this announcement.

Growth Factors this Past Quarter

Improved merchandise and increased demand on account of remodeling activities following Hurricane Sandy, led Lowe’s to post better-than-expected fourth-quarter fiscal 2012. Lowe’s boasts a proven strategy of investing in stores to enhance customer-shopping experience by improving point-of-sale and directional signage, and enhancing its array of products.

Earnings Whispers?

Our proven model does not conclusively show that Lowe’s is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method)and a Zacks Rank of #1, #2 or #3 for this to happen. This is not the case here as you will see below.

Negative Zacks ESP: ESP for Lowe’s is -1.96%. This is because the Most Accurate Estimate stands at 50 cents, while the Zacks Consensus Estimate is pegged at 51 cents.

Zacks Rank #3 (Hold): Lowe’s Zacks Rank #3 (Hold) lowers the predictive power of ESP because the Zacks Rank #3 when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat:

Flowers Foods, Inc. (FLO - Snapshot Report) with Earnings ESP of +9.38% and a Zacks Rank #1 (Strong Buy).

J&J Snack Foods Corp. (JJSF - Snapshot Report) with Earnings ESP of +0.90% and a Zacks Rank #2 (Buy).

ConAgra Foods, Inc. (CAG - Analyst Report) with Earnings ESP of +1.70% and a Zacks Rank #3 (Hold).

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