What to Expect from Lowe’s 3Q17 Earnings

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What to Expect from Lowe’s 3Q17 Earnings PART 1 OF 5

Will Lowe’s 3Q17 Earnings Boost Its Stock Price?

Stock performance

Lowe’s Companies (LOW) is scheduled to announce its 3Q17 earnings before the market opens on November 21. As of November 13, the company was trading at $77.53, which represents a rise of 2.3% since the announcement of its 2Q17 earnings on August 23.

Will Lowe&#8217;s 3Q17 Earnings Boost Its Stock Price?

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In 2Q17, Lowe’s posted adjusted EPS (earnings per share) of $1.57 on revenues of $19.50 billion. However, analysts were expecting the company to post EPS of $1.61 and revenues of $19.53 billion. After posting its 2Q17 earnings, Lowe’s management lowered its 2017 EPS guidance, citing increased investments in marketing and services to enhance the customer experience. Despite the lowering of 2017 EPS guidance, Lowe’s stock price rose due to expectations of a rise in sales from the recovery efforts after the devastation caused by hurricanes Harvey and Irma.

Year-to-date performance

Since the beginning of 2017, Lowe’s stock price has risen 9.0%. During the same period, its peers Home Depot (HD), Williams-Sonoma (WSM), and Bed Bath & Beyond (BBBY) have returned 23.3%, 6.1%, and -51.5%, respectively.

Notably, the broader comparative indices, the SPDR S&P Homebuilders (XHB) and the S&P 500 Index (SPX) have returned 21.1%, and 15.5%, respectively. XHB has invested approximately 22.0% of its holdings in home furnishing and home improvement companies.

Series overview

With Lowe’s 3Q17 earnings around the corner, we’ll look at analysts’ revenue and EPS estimates. Also, we’ll look at management’s 2017 guidance and analysts’ estimates for the next four quarters. Finally, we’ll wrap up this series by looking at Lowe’s valuation multiple and analysts’ recommendations.

Let’s start our preview by looking at Lowe’s 3Q17 revenue estimates.


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