The Gory Details on Lowe's Double Fumble

Seth Jayson, The Motley Fool
Updated

Lowe's (NYS: LOW) reported earnings on May 22. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended May 3 (Q1), Lowe's missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue was unchanged. GAAP earnings per share expanded.


Margins grew across the board.

Revenue details
 Lowe's tallied revenue of $13.09 billion. The 20 analysts polled by S&P Capital IQ expected a top line of $13.46 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
 EPS came in at $0.49. The 24 earnings estimates compiled by S&P Capital IQ predicted $0.51 per share. GAAP EPS of $0.49 for Q1 were 14% higher than the prior-year quarter's $0.43 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
 For the quarter, gross margin was 34.8%, 10 basis points better than the prior-year quarter. Operating margin was 7.5%, 30 basis points better than the prior-year quarter. Net margin was 4.1%, 10 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
 Next quarter's average estimate for revenue is $14.96 billion. On the bottom line, the average EPS estimate is $0.78.

Next year's average estimate for revenue is $52.49 billion. The average EPS estimate is $2.11.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,137 members out of 2,427 rating the stock outperform, and 290 members rating it underperform. Among 720 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 682 give Lowe's a green thumbs-up, and 38 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lowe's is outperform, with an average price target of $40.26.

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The article The Gory Details on Lowe's Double Fumble originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool recommends Lowe's. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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