Lowe’s Earnings vs. Expectations
In the Q4 report released by Lowe’s, the company showed a total quarterly revenue of $20.31 billion. This represents a climb in revenues worth over $4 billion in comparison to the same quarter in 2019. The company also beat out analyst expectations for the quarter which only had the increase in new business reaching $19.48 billion. The home improvement company also outperformed projections in earnings per share as well by reporting gains of $1.33 per share, over $0.10 higher than the expected $1.21 per share. The earnings per share also represents a nearly $0.40 increase from the same quarter last year, where the company only reported earnings of $0.94 per share.
The major success for the business has come mostly on the back of a major sales spike of roughly 28.1%. Those gains came mostly from the ability of the company to properly integrate ecommerce sales into its business model as Lowes.com grew by a whopping 121%. Lowe’s has been a leader in the growing DIY home improvement trend seen across the entire industry as the COVID-19 pandemic has shifted where consumers are spending their money. However, just like its competitor Home Depot, the company also expressed concern about the sustainability of these numbers once the pandemic begins to wane.
Lowe’s Future Outlook and Stock Market Response
In a similar manner to Home Depot, Lowe’s did not provide guidance for 2021, though it did issue a small section on the future of the business, expecting sales to contract slightly moving forward. The business does plan to move forward with plans for $9 billion worth of share repurchases and $2 billion in capital expenditures. Despite concerns about the future of the home improvement business, the company saw shares rise in pre-market trading, up over 2% early this morning. Company stock is now worth over $170 per share.
In a statement released alongside the Q4 report, Lowe’s President and CEO, Marvin R. Ellison, said, “I would like to thank our front-line associates for their continued dedication to serving our customers and communities and supporting safety in our stores. I am pleased with our progress in 2020 as we generated nearly $90 billion in sales, with annual sales growth of over $17 billion, while also enhancing our operating efficiency. Looking ahead to 2021, we expect to grow market share and drive further operating margin expansion.”
About the Author
Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.