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Lowe's Companies Third Quarter Earnings
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Lowe's Companies (NYSE:LOW) announced its results for the third quarter on November 19, 2012. Lowe's Companies is a home improvement retailer offering products to homeowners, renters, and commercial business customers.
Earnings play an important role in measuring the appropriate valuation for a stock. Investors should be cautious if the company's stock price is high but it consistently has low earnings. SEE: Can Earnings Guidance Accurately Predict The Future?
The Numbers: Lowe's Companies' EPS fell in line with analyst expectations of 35 cents per share while revenue of $12.07 billion missed estimates of $12.98 billion. EPS rose 94.4% while revenue climbed 1.9% from the same period last year. Year over year revenue increases in the past five quarters have averaged 4.2%. The company's net income for the quarter rose 76% to $396 million.
Management Quote: "We are keenly focused on improving our core business," commented Robert A. Niblock, Lowe's chairman, president and CEO. "Our level of execution is improving and we delivered solid results in the third quarter. I would like to thank our employees for their continued dedication and customer focus.
A Look Back: Margins were up in the second quarter, following a drop in the previous quarter. Gross margins grew to 34.3%, up 0.3 percentage point from the year-earlier quarter. In the first quarter, the figure rose 0.6 percentage point to 33.9% from the year earlier quarter.
Net income has increased 9.8% year-over-year on average across the last five quarters. The biggest gain came in the most recent quarter, when income climbed 76% from the year-earlier quarter.
Looking Ahead: Over the past 90 days, the average estimate for the fourth quarter has fallen from 25 cents per share to 20 cents, indicating that analysts are growing pessisimistic about the company's performance next quarter. Decreasing earnings estimates is generally a negative sign as it suggests analyst believe future earnings to be weaker than previously anticipated. The average estimate for the fiscal year is $1.66 per share, down from $1.79 90 days ago.
Earnings play an important role in measuring the appropriate valuation for a stock. Investors should be cautious if the company's stock price is high but it consistently has low earnings. SEE: Can Earnings Guidance Accurately Predict The Future?
The Numbers: Lowe's Companies' EPS fell in line with analyst expectations of 35 cents per share while revenue of $12.07 billion missed estimates of $12.98 billion. EPS rose 94.4% while revenue climbed 1.9% from the same period last year. Year over year revenue increases in the past five quarters have averaged 4.2%. The company's net income for the quarter rose 76% to $396 million.
Management Quote: "We are keenly focused on improving our core business," commented Robert A. Niblock, Lowe's chairman, president and CEO. "Our level of execution is improving and we delivered solid results in the third quarter. I would like to thank our employees for their continued dedication and customer focus.
A Look Back: Margins were up in the second quarter, following a drop in the previous quarter. Gross margins grew to 34.3%, up 0.3 percentage point from the year-earlier quarter. In the first quarter, the figure rose 0.6 percentage point to 33.9% from the year earlier quarter.
Net income has increased 9.8% year-over-year on average across the last five quarters. The biggest gain came in the most recent quarter, when income climbed 76% from the year-earlier quarter.
Looking Ahead: Over the past 90 days, the average estimate for the fourth quarter has fallen from 25 cents per share to 20 cents, indicating that analysts are growing pessisimistic about the company's performance next quarter. Decreasing earnings estimates is generally a negative sign as it suggests analyst believe future earnings to be weaker than previously anticipated. The average estimate for the fiscal year is $1.66 per share, down from $1.79 90 days ago.
by
Investopedia Staff
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