Lowe’s beats on profit and sales and provides upbeat outlook, but stock falls

Lowe’s Companies
LOW,
-0.71%
reported Wednesday fiscal first-quarter profit, sales and same-store sales that rose above expectations, and provided an upbeat outlook, but the home improvement retailer’s stock fell 1.5% in premarket trading amid a broad market selloff. Net income for the quarter to April 30 rose to $2.32 billion, or $3.21 a share, from $1.34 billion, or $1.76 a share, in the year-ago period. That beat the FactSet consensus for earnings per share of $2.61. Sales increased 24.1% to $24.42 billion, above the FactSet consensus of $23.81 billion, as same-store sales grew 25.9% to beat expectations of 20.7% growth. Cost of sales rose 23.8%, with gross margin improving to 33.3% of sales from 33.1%. The company said it spent $3.1 billion during the quarter to repurchase 16.8 million shares. Lowe’s said the “very strong” sales momentum it saw in the first quarter has continued in May, with fiscal 2021 sales currently “tracking ahead” of previous guidance of $86 billion. “Better-than-expected year-to-date results and a supportive macroeconomic backdrop build the company’s confidence in its ability to deliver strong results for the fiscal year, including continued market share gains and the achievement of a 12% operating margin,” the company said in a statement. The stock’s decline comes as S&P 500
SPX,
-0.85%
futures
ES00,
-0.91%
slumped 0.9% ahead of the open.