Lowe’s posts strong Q4 results on strong housing market

NEW YORK — Lowe’s Cos., the nation’s second-largest dwelling enchancment chain behind Residence Depot, supplied an upbeat annual outlook after reporting strong fiscal fourth-quarter results that confirmed a nonetheless scorching housing market.

The report, launched Wednesday, follows a sturdy quarterly report from Residence Depot.

Residence enchancment shops have been busy in the course of the pandemic as folks working from dwelling took on new initiatives. Many additionally moved into new houses with extra space for a house workplace. A excessive stock of growing old houses has additionally helped to propel dwelling house owners to repair up their homes.

Gross sales of beforehand occupied houses rose in January as a surge in patrons with money and others desperate to keep away from increased mortgage charges snapped up properties, leaving the variety of accessible homes on the market at a report low.

Current dwelling gross sales rose 6.7% final month from December to a seasonally adjusted annual price of 6.5 million, the Nationwide Affiliation of Realtors stated Friday. That’s greater than the roughly 6.08 million gross sales that economists had been anticipating, in keeping with FactSet.

Properly earlier than the pandemic, Lowe’s, beneath the stewardship of its CEO Marvin Ellison, overhauled an antiquated web site and elevated Lowe’s enterprise with skilled clients like electricians and contractors. That helped the corporate to pivot in the course of the pandemic, when extra folks had been relying on on-line providers. And whilst Lowe’s now offers with industrywide provide chain points and better prices, it’s utilizing its clout to maintain cabinets stocked whereas making an attempt to tame inflation at its shops.

Ellison instructed The Related Press on Wednesday that fifty% of its income in the latest third and fourth quarters got here from inflation. “The shopper is keen to pay extra if the value is aggressive,” he stated. He stated buyers are additionally keen to commerce up for extra modern merchandise.

Lowe’s can be increasing to new areas to maintain gross sales rising. The chain introduced in January a partnership with Petco Well being and Wellness Firm to create pet provide outlets beneath the Petco model at its shops. The plans name for opening practically 20 outlets in Texas, North Carolina and South Carolina by subsequent month. It is also tapping into the growing old child boomer market; it launched an initiative final 12 months to create a one-stop vacation spot at its shops aimed toward seniors who need to keep of their houses.

Lowe’s, based mostly in Mooresville, North Carolina, stated that it earned $1.21 billion, or $1.78 per share, for the quarter ended Jan. 28. The results beat Wall Avenue expectations. The typical estimate of 12 analysts surveyed by Zacks Funding Analysis was for earnings of $1.72 per share.

The house enchancment retailer posted income of $21.34 billion within the interval, additionally surpassing Avenue forecasts. 9 analysts surveyed by Zacks anticipated $20.82 billion.

Gross sales at its established shops rose 5.1%. Gross sales from “Professional” clients elevated 23%.

Lowe’s now expects full-year earnings to be $13.10 to $13.60 per share, with income within the vary of $97 billion to $99 billion.

Analysts predict earnings per share of $12.93 on gross sales of $97.26 billion for the present 12 months, in keeping with FactSet.

Shares rose greater than 2%, or $5.01, to $219.60 in morning buying and selling.

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Components of this story had been generated by Automated Insights (http://automatedinsights.com/ap) utilizing knowledge from Zacks Funding Analysis. Entry a Zacks inventory report on LOW at https://www.zacks.com/ap/LOW

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AP Enterprise Author Michelle Chapman contributed to this report.

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