Lowe's Q1 Profit Falls, But Beats Estimates; Cuts Annual Outlook; Stock Down

(RTTNews) - Lowe's Companies, Inc. (LOW), a retail company focused on home improvement, on Tuesday reported a decline earnings for the first-quarter, amidst a fall in sales, reflecting lumber deflation, unfavorable weather, and lower DIY discretionary sales. However, excluding items, the company's earnings beat the Street view.

Lowe's has revised down its full-year guidance to reflect softer-than-expected consumer demand for discretionary purchases.

Following the news, LOW was trading down by 0.37 percent at $202.39 per share, in the pre-market trading on the New York Stock Exchange.

For the three-month period, the company posted a net income of $2.260 billion, lesser than $2.333 billion, posted for the same period of 2022.

Earnings per share or EPS, however, moved up to $3.77 from last year's $3.51 per share. A rise in EPS was due to a gain associated with the sale of the Canadian retail business in 2022, which impacted first quarter EPS positively by $0.10.

Excluding items, EPS was at $3.67. On average, 29 analysts, polled by Thomson Reuters were expecting the company to post EPS of $3.44, for the quarter. Analysts' estimates typically exclude special items. Pre-tax earnings were at $2.939 billion, versus $3.059 billion a year ago.

Operating income stood at $3.288 billion, compared with previous year's $3.302 billion.

Lowe's posted sales of $22.347 billion, lesser than $23.659 billion of 2022.

Citing a higher-than-expected lumber deflation and lower-than-expected DIY discretionary sales, the company has revised down its full year 2023 guidance.

For the 12-month period, the company now expects adjusted EPS of $13.20 - $13.60 as against its previous expectation of $13.60 - $14.

Total sales are now projected to be around $87 billion - $89 billion against previous outlook of $88 billion - $90 billion.

Analysts, on average, expect the firm to report adjusted EPS of $13.6, on sales of $88.45 billion.