Lowe’s (LOW) Reports Better than Expected 4Q Results

Lowe’s Companies Inc. (LOW) reported fourth quarter EPS of $0.46 before the opening bell Wednesday, compared to the consensus estimate of $0.43. Revenues increased 7.5% from last year to $12.54 billion. Analysts expected revenues of $12.31 billion. The stock is currently up $0.40 to $75.05 on 363,523 shares.

Net earnings came in at $450 million, up 47% from the same period a year ago. The fourth quarter results bring the home improvement chain’s 2014 revs to $56.2 billion, its net earnings to $2.7 billion and its EPS to $2.71.

Same store sales in the U.S. grew 7.3% in the fourth quarter and 4.3% over the year. Comparable sales for the U.S. business increased 7.4%.

“We remain focused on improving our profitability even while investing in key capabilities to drive sales growth,” said in a statement Lowe’s CEO Robert Niblock. “Our transformation is gaining momentum, and macroeconomic fundamentals are aligned for modestly stronger home improvement industry growth in 2015.”

For FY’16, Lowe’s provided EPS guidance of $3.29 versus consensus of $3.26 per share. The company also issued revenue projection of $58.75-59.0 billion, compared to the consensus revenue estimate of $58.55 billion.

On valuation measures, Lowe’s Cos. shares, which currently have an average 3-month trading volume of 5,102,940 shares, trade at a trailing-12 P/E of 29.76, a forward P/E of 22.76 and a P/E to growth ratio of 1.56. The median Wall Street price target on the name is $72.00 with a high target of $80.00. Currently ticker boasts 13 ‘Buy’ endorsements, compared to 14 ’Holds’ and no ‘Sell’.

Profitability-wise, LOW has a t-12 profit and operating margin of 4.62% and 8.41%, respectively. The $72.97 billion market cap company reported $1.77 billion in cash vs. $11.36 billion in debt in its most recent quarter.

LOW currently prints a one year return of about 60.70%, and a year-to-date return of around 8.90%.

The chart below shows where the equity has traded over the last 52 weeks.

Lowe’s Companies, Inc. operates as a home improvement retailer. The company was founded in 1946 and is based in Mooresville, North Carolina.

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